UNITED STATES
SECURITIES AND EXCHANGE
COMMISSION
Washington, D.C. 20549
FORM 6-K
REPORT OF FOREIGN PRIVATE ISSUER PURSUANT TO RULE
13a-16 OR 15d-16
UNDER THE SECURITIES EXCHANGE ACT OF 1934
For the month of January 2025
Commission File Number 001-38628
SilverCrest Metals Inc.
(Exact name of Registrant as specified in its charter)
N/A
(Translation of Registrant’s name into English)
570 Granville Street, Suite 501
Vancouver, British Columbia V6C 3P1
Canada
(Address of principal executive offices)
Indicate by check mark whether the registrant files or will
file annual reports under cover of Form 20-F or Form 40-F:
Form 20-F ☐ Form
40-F ☒
SIGNATURE
Pursuant to the requirements of the Securities Exchange
Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
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SILVERCREST METALS INC. |
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| Date: January 13, 2025 |
By: |
/s/ Sean Deissner |
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Name: |
Sean Deissner |
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Title: |
VP, Financial Reporting |
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INDEX TO EXHIBITS
EXHIBIT 99.1
Notice
of Special Meeting and
Management Information Circular
With respect to a proposed Plan of Arrangement involving SilverCrest
Metals Inc. and Coeur Mining, Inc.
Dated as of January 8, 2025
For the Special Meeting of Securityholders
To be held at 10:00 a.m. (Vancouver time) on February 6, 2025
At Suite 2200, RBC Place, 885 West Georgia Street, Vancouver, British Columbia
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Take Action and Vote Today.
The Board of Directors of SilverCrest unanimously recommends
that Securityholders
vote FOR the Arrangement Resolution
These materials are important and require your immediate attention.
The shareholders and optionholders of SilverCrest Metals Inc. are required to make important decisions. If you have any doubt
as to how to make such decisions, please contact your tax, financial, legal or other professional advisors. Securityholders that require
further assistance may contact SilverCrest’s proxy solicitation agent and shareholder communications advisor, Laurel Hill Advisory
Group, at:
Laurel Hill Advisory Group
North American Toll-Free: 1.877.452.7184
Calls Outside North America: 416.304.0211
Email: assistance@laurelhill.com |
Letter to Securityholders
January 8, 2025
Dear Shareholders and Optionholders:
The board of directors (the “Board”) of SilverCrest
Metals Inc. (the “Company” or “SilverCrest”) invites you to attend the special meeting (the “Meeting”)
of the holders (the “Shareholders”) of common shares of the Company (the “SilverCrest Shares”) and
the holders of stock options of the Company (the “Optionholders”, and collectively with the Shareholders, the “Securityholders”)
to be held on February 6, 2025 at 10:00 a.m. (Vancouver time) at the offices of Cassels Brock & Blackwell LLP at Suite 2200, RBC Place,
885 West Georgia Street, Vancouver, British Columbia. The Meeting can also be accessed via live webcast at meetnow.global/MHZWLAD. Any
Securityholder attending the live webcast will not be able to vote during the Meeting. Only Securityholders or their duly appointed proxyholders
who are present in person at the Meeting are able to vote during the Meeting.
At the Meeting, Securityholders will be asked to consider and, if
deemed acceptable, pass a special resolution (the “Arrangement Resolution”) approving an arrangement (the “Arrangement”)
with Coeur Mining, Inc. (“Coeur”) pursuant to a statutory plan of arrangement under Division 5 of Part 9 of the Business
Corporations Act (British Columbia) (the “BCBCA”) whereby Coeur will indirectly, among other things, acquire all
of the issued and outstanding SilverCrest Shares. As a result of the Arrangement, SilverCrest will become a wholly-owned subsidiary of
Coeur.
The Arrangement
On October 3, 2024, SilverCrest, Coeur, 1504648 B.C. Unlimited Liability
Company, an unlimited liability company organized and existing under the laws of the Province of British Columbia, Canada and a wholly-owned
subsidiary of Coeur (“Coeur Canadian Sub”), Coeur Rochester, Inc., a Delaware corporation, and Compañía
Minera La Llamarada, S.A. de C.V., a company existing under the laws of Mexico, entered into an arrangement agreement (the “Arrangement
Agreement”), pursuant to which, among other things, Coeur agreed to acquire, through Coeur Canadian Sub, all of the issued and
outstanding SilverCrest Shares for consideration of 1.6022 (the “Exchange Ratio”) shares of Coeur common stock (each
whole share, a “Coeur Share”) for each SilverCrest Share outstanding (the “Consideration”). Immediately
following completion of the Arrangement, former Shareholders and existing stockholders of Coeur (the “Coeur Stockholders”)
are anticipated to own approximately 37% and 63% of Coeur, respectively (based on the issued and outstanding SilverCrest Shares and Coeur
Shares as of the date of the Arrangement Agreement).
Pursuant to the Arrangement, each outstanding stock option of the
Company (a “SilverCrest Option”) will be exchanged for an option (a “Replacement Option”) to purchase
from Coeur such number of Coeur Shares (rounded down to the nearest whole number) equal to the product of: (A) the number of SilverCrest
Shares subject to such SilverCrest Option immediately prior to the effective time of the Arrangement (the “Effective Time”),
multiplied by (B) the Exchange Ratio, at an exercise price per Coeur Share (rounded up to the nearest whole cent) equal to (X) the exercise
price per SilverCrest Share otherwise purchasable pursuant to such SilverCrest Option immediately prior to the Effective Time, divided
by (Y) the Exchange Ratio. For further information, please see “The Arrangement – Plan of Arrangement” and “The
Arrangement – Exchange Procedure – Treatment of Options” in the accompanying management information circular of
SilverCrest (the “Circular”).
Registered Shareholders are concurrently being provided with a letter
of transmittal setting forth how to exchange their SilverCrest Shares for the Consideration. Shareholders whose SilverCrest Shares are
registered in the name of a broker, dealer, bank, trust company or other nominee must contact their nominee to deposit their SilverCrest
Shares and receive their Consideration under the Arrangement. Optionholders do not need to take any action upon completion of the Arrangement
for their Replacement Options to be issued.
Benefits to Securityholders
In reaching its conclusions and formulating its recommendation that
Securityholders vote FOR the Arrangement Resolution, the Board reviewed and considered a significant amount of information
as well as a number of factors relating to the Arrangement, with the benefit of advice from the special committee of the Board (the “Special
Committee”), the financial and legal advisors of SilverCrest
and input from SilverCrest’s senior management team, a summary
of which is presented below.
A more fulsome description of the information and factors considered by the Board and the Special Committee is located in the accompanying
Circular:
| · | Significant Premium. The Consideration represents an implied
value of US$11.34 per SilverCrest Share, being an 18% premium based on the 20-day volume-weighted average prices of the Coeur Shares and
SilverCrest Shares, each as at October 3, 2024 on the NYSE and NYSE American, respectively, and a 22% premium to the October 3, 2024
closing price of SilverCrest Shares on the NYSE American, being the last trading day prior to the announcement of the Arrangement. This
also represents an all-time high in the value of SilverCrest Shares for Shareholders. |
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| · | Meaningful Exposure to Diverse Asset
Portfolio. Current Shareholders will maintain exposure to the Company’s high-grade, low-cost and high-margin Las Chispas
operation and will gain exposure to Coeur’s high quality and diversified portfolio consisting of four robust operating mines
in the U.S. and Mexico and an exploration property in Canada, with further potential upside from the district-scale exploration
potential of the combined company and organic mineral reserve growth. Current Shareholders will hold approximately 37% of the issued
and outstanding shares of the combined company upon completion of the Arrangement, based on the number of securities of Coeur and
SilverCrest issued and outstanding as of October 3, 2024. |
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| · | Creation of a Leading Global Silver Company. The addition of Las Chispas to Coeur’s
growing silver production from its recently expanded Rochester mine in Nevada and its Palmarejo underground mine in northern Mexico has
the potential to generate significant 2025 silver production of approximately 21 million ounces from five North American operations, with
approximately 56% of revenue generated from U.S.-based mines and approximately 40% of revenue from silver. In addition to the significant
silver production, it is anticipated that the combined company can produce approximately 432,000 ounces of gold in 2025. |
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| · | Strong Cash Flow and Deleveraging of Combined Company. The combined
company is expected to generate approximately US$700 million of EBITDA1 and US$350 million of free cash flow1
in 2025 at lower overall costs and higher overall margins for Coeur. The combined company will also have more robust cash flow with the
benefit of multiple producing mines in a diversified portfolio. The strong cash flow profile of the combined company will be augmented
by SilverCrest’s strong balance sheet and no debt which are expected to result in an immediate 40% reduction in the combined company’s
leverage ratio upon closing of the Arrangement. |
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| · | Strategic Review Process and Value Maximization. The Arrangement
with Coeur is the culmination of a comprehensive strategic review process that was initiated following Las Chispas achieving commercial
production in late 2022, which process was overseen by the Board initially, and subsequently, the Special Committee, with the assistance
of the Company’s financial advisors (including Raymond James Ltd. initially in late 2022 and the addition of Cormark Securities
Inc. in 2024). During this process, the Company, through its financial advisors, canvassed numerous other potential parties to determine
market interest in a transaction involving, and explore various strategic opportunities available to, SilverCrest (including maintaining
status quo, asset purchases, merger of equals, acquisitions and a sale of the Company). This process resulted in the evaluation of over
25 potential strategic opportunities, the execution of more than 15 confidentiality agreements, substantive reviews and site visits of
more than 10 mineral properties and multiple site visits hosted at Las Chispas. See “The Arrangement – Background to the
Arrangement” in the Circular for more details on the strategic review process undertaken by the Company. After consultation
on the proposed Arrangement with legal and financial advisors, and after review of the current and prospective business climate in the
precious metals mining industry and other strategic opportunities reasonably available to SilverCrest, including continuing as an independent
entity, potential acquisitions and sales, in each case taking into account the potential benefits, risks and uncertainties associated
with those other opportunities, the Special Committee and the Board believe the Arrangement represents SilverCrest’s best prospect
for maximizing Shareholder value. |
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| · | Asset Diversification and Elimination of Single Asset Risk. The
business, operations, assets, financial condition, operating results and prospects of SilverCrest are subject to significant uncertainty,
including, but not limited to, risks associated with SilverCrest’s dependency on the Las Chispas operation for its future operating
revenue, permitting and regulatory approvals, exploration and development risks and commodity price and inflation risks. The combined
company will be better positioned to pursue a growth and value maximizing strategy as compared with SilverCrest on a standalone basis,
as a result of the combined company’s larger market capitalization, asset and
geographical diversification, elimination of single asset risk, technical expertise, greater trading liquidity, enhanced access to capital
over the long term and the likelihood of increased investor interest and access to business development opportunities due to the combined
company’s larger market presence. |
1 This
is a non-GAAP performance measure. See “Management Information Circular – Non-GAAP Financial Performance Measures”
of the Circular.
| · | Proven Leadership Team. Following the Arrangement, two of the
current directors of SilverCrest, Messrs. N. Eric Fier and Pierre Beaudoin, will join the board of the combined company. Management of
the combined company will feature proven and experienced mining and business leaders at both the board and executive management levels,
along with diverse, high performing teams at the regional and operating sites with a proven track record of maximizing value by delivering
long-life and profitable silver and gold mining operations. The combined company will continue its commitment to ESG with a specific focus
on water usage, emissions, community and workforce development, and leading governance practices. |
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| · | Fairness Opinions. The Special Committee received a fairness
opinion from Scotiabank, and the Board received a fairness opinion from each of Cormark Securities Inc. and Raymond James Ltd., all dated
October 3, 2024 to the effect that the Consideration to be received by the Shareholders pursuant to the Arrangement is fair, from a financial
point of view, to the Shareholders, based upon and subject to various assumptions, limitations and qualifications set forth, respectively,
in each such opinion, as more fully described under “The Arrangement – Fairness Opinions” in the Circular. |
Board Recommendation
The Board, based on its considerations, investigations and deliberations,
including a thorough review of the Arrangement Agreement, the fairness opinions of Cormark Securities Inc. and Raymond James Ltd. (as
discussed further in the accompanying Circular) and other relevant matters, and taking into account the best interests of the Company,
and after consultation with management and its financial and legal advisors and having received the unanimous recommendation of the Special
Committee, which takes into account, among other things, the fairness opinion that the Special Committee received from Scotiabank, has
unanimously determined, that the Arrangement and the entering into of the Arrangement Agreement are in the best interests of the Company,
has unanimously approved the Arrangement and recommends that the Securityholders vote FOR the Arrangement
Resolution. The determination of the Special Committee and the Board is based on various factors set forth above and described more fully
in the accompanying Circular.
Required Approvals
SilverCrest Securityholder Approval
The Arrangement
Resolution, the full text of which is set out in Appendix A to the accompanying Circular, must be approved by at least (i) 66⅔%
of the votes cast by Shareholders present in person or represented by proxy and entitled to vote at the Meeting; (ii) 66⅔%
of the votes cast by Securityholders, voting together as a single class, present in person or represented by proxy and entitled to vote
at the Meeting, with Shareholders and Optionholders being entitled to one vote for each SilverCrest Share and SilverCrest Option, respectively;
and (iii) a simple majority of the votes cast by Shareholders present in person or represented by proxy and entitled to vote at the
Meeting, excluding certain SilverCrest Shares required to be excluded in accordance with Multilateral Instrument 61-101 – Protection
of Minority Security Holders in Special Transactions. If the Arrangement Resolution is not approved at the Meeting, the Arrangement
will not be completed.
Coeur Stockholder Approvals
The issuance of Coeur Shares as Consideration under the Arrangement
and the amendment to the certificate of incorporation of Coeur to effect an increase to the number of authorized Coeur Shares (collectively,
the “Coeur Stockholder Approvals”) must each be approved by a majority of the votes cast by Coeur Stockholders present
in person or represented by proxy and entitled to vote at a meeting of Coeur Stockholders (the “Coeur Meeting”). The
Arrangement will not be completed if the Coeur Stockholder Approvals are not obtained.
Regulatory Approvals
Completion of the Arrangement is also subject to
certain regulatory approvals, including the approval of the Supreme Court of British Columbia, the conditional approval of the Toronto
Stock Exchange in respect of the Arrangement, the approval of the listing and posting for trading of the Coeur Shares to be issued in
connection with the Arrangement on the New York Stock Exchange, and the approval of the Federal Competition Commission of Mexico (Comisión
Federal de Competencia Económica) pursuant to the Federal Law of Economic Competition (Ley Federal de Competencia Económica).
The Arrangement will not proceed if any of such approvals are not obtained.
Support Agreements
Each of the directors and senior officers of SilverCrest have entered
into a voting and support agreement with Coeur, pursuant to which they have agreed to, among other things, vote, or cause to be voted,
all of the SilverCrest Shares and/or SilverCrest Options
held or controlled by them FOR
the Arrangement Resolution. Securityholders holding approximately 2.3% of the outstanding SilverCrest Shares, and 3.4% of the outstanding
SilverCrest Shares and SilverCrest Options collectively, each as of the record date of the Meeting, have entered into voting and support
agreements with Coeur.
Each of the directors and senior officers of Coeur have also entered
into a voting and support agreement with SilverCrest, pursuant to which they have agreed to, among other things, vote, or cause to be
voted, all of the Coeur Shares held or controlled by them in favour of the issuance of Coeur Shares as Consideration under the Arrangement
and the related amendment of the authorized share capital in Coeur’s certificate of incorporation. Coeur Stockholders holding approximately
1.5% of the outstanding Coeur Shares as of the record date of the Coeur Meeting, have entered into voting and support agreements with
SilverCrest.
YOUR VOTE IS IMPORTANT. WHETHER OR NOT YOU PLAN TO ATTEND THE MEETING
IN PERSON, WE ENCOURAGE YOU TO VOTE PROMPTLY.
The Arrangement is anticipated to be completed late in the first quarter
of 2025, subject to obtaining SilverCrest Securityholders’ approval, Coeur Stockholder Approvals, the regulatory approvals detailed
above, as well as the satisfaction or waiver of other conditions contained in the Arrangement Agreement. Full details of the Arrangement,
as well as detailed information regarding SilverCrest, Coeur and certain pro forma and other information concerning Coeur after
giving effect to the Arrangement, are set out in the accompanying Circular. The Circular describes the Arrangement and includes certain
additional information to assist you in considering how to vote on the Arrangement Resolution, including certain risk factors relating
to the completion of the Arrangement. You should carefully review and consider all of the information in the Circular, and if you require
assistance, consult your financial, legal, tax or other professional advisor.
Regardless of whether Securityholders are
attending the Meeting in person or via live webcast, Securityholders are encouraged to promptly submit the enclosed proxy form, or
voting instruction form (“VIF”), as applicable. Securityholders may vote online, by telephone or by mail.
Pursuant to the interim order of the Supreme Court of British Columbia dated January 8, 2025, proxies to be used at the Meeting,
must be received by the Company’s transfer agent, Computershare Investor Services Inc. by no later than 10:00 a.m. (Vancouver
time) on February 4, 2025 (or, if the Meeting is adjourned or postponed, by the time that is 48 hours prior to the Meeting,
excluding Saturdays, Sundays and holidays). See “Information Concerning the Meeting – Proxy Instructions”
in the accompanying Circular.
Securityholders that have questions or require further assistance,
please contact SilverCrest’s proxy solicitation agent and shareholder communications advisor, Laurel Hill Advisory Group, by: (i)
telephone, toll-free for Securityholders in North America at 1.877.452.7184, or collect call for Securityholders outside of North America
at 416.304.0211; or (ii) email at assistance@laurelhill.com.
On behalf of the Company, I thank all Securityholders
for their continued support and we look forward to receiving your endorsement for this transaction at the Meeting.
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Yours
very truly, |
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/s/
“N. Eric Fier” |
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N.
Eric Fier |
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Chief Executive Officer and Director |
NOTICE OF SPECIAL MEETING OF SECURITYHOLDERS
To be held on February 6,
2025
NOTICE IS HEREBY GIVEN that a special meeting (the “Meeting”)
of the holders (the “Shareholders”) of common shares (the “SilverCrest Shares”) of SilverCrest Metals
Inc. (“SilverCrest” or the “Company”) and the holders of stock options of the Company (the “Optionholders”,
and collectively with the Shareholders, the “Securityholders”) will be held at the offices of Cassels Brock & Blackwell
LLP at Suite 2200, RBC Place, 885 West Georgia Street, Vancouver, British Columbia and via live webcast, at 10:00 a.m. (Vancouver time)
on February 6, 2025 for the following purposes:
| 1. | to consider, in accordance with the interim order of the Supreme Court
of British Columbia dated January 8, 2025 (the “Interim Order”), and,
if deemed acceptable, to pass, with or without variation, a special resolution (the “Arrangement Resolution”) approving
a statutory plan of arrangement (the “Plan of Arrangement”) under Division 5 of Part 9 of the Business Corporations
Act (British Columbia) (“BCBCA”) pursuant to which Coeur Mining, Inc. (“Coeur”) will indirectly,
among other things, acquire all of the issued and outstanding SilverCrest Shares, the full text of which is set forth in Appendix A to
the accompanying management information circular (“Circular”); and |
| 2. | to transact such other business as may properly come before the Meeting
or any adjournments or postponements thereof. |
The board of directors of the Company unanimously recommends that
the Securityholders vote FOR the Arrangement Resolution.
In addition to in-person attendance, the Meeting can also be accessed
via live webcast at meetnow.global/MHZWLAD. Any Securityholder attending the Meeting via the live webcast will not be able to vote during
the Meeting. Only Securityholders or their duly appointed proxyholders who are present in person at the Meeting are able to vote during
the Meeting. Accordingly, in order that as many SilverCrest Shares and stock options as possible are represented at the Meeting, Securityholders
are encouraged to vote their SilverCrest Shares and/or stock options via proxy prior to the proxy cut-off time as further described below.
Pursuant to the Interim Order, the record date is December 19, 2024
(the “Record Date”) for determining Securityholders who are entitled to receive notice of and to vote at the Meeting.
Only registered Shareholders (“Registered Shareholders”) and Optionholders as of the Record Date are entitled to receive
notice of the Meeting (“Notice of Meeting”) and to vote at the Meeting. This Notice of Meeting is accompanied by the
Circular, an applicable form of proxy and a letter of transmittal for Registered Shareholders (the “Letter of Transmittal”).
Each SilverCrest
Share and SilverCrest Option entitled to be voted at the Meeting will entitle the holder thereof to one vote at the Meeting for each SilverCrest
Share and SilverCrest Option, respectively. In order to become effective, the Arrangement Resolution must be approved by at least (i) 66⅔%
of the votes cast by Shareholders present in person or represented by proxy and entitled to vote at the Meeting; (ii) 66⅔%
of the votes cast by Securityholders, voting together as a single class, present in person or represented by proxy and entitled to vote
at the Meeting, with Shareholders and Optionholders being entitled to one vote for each SilverCrest Share and SilverCrest Option, respectively;
and (iii) a simple majority of the votes cast by Shareholders present in person or represented by proxy and entitled to vote at the
Meeting, excluding certain SilverCrest Shares required to be excluded in accordance with Multilateral Instrument 61-101 – Protection
of Minority Security Holders in Special Transactions.
Registered Shareholders and Optionholders are requested to read the
enclosed Circular and are requested to date and sign the enclosed proxy form promptly, as applicable, and return it in the self-addressed
envelope enclosed for that purpose or by any of the other methods indicated in the proxy form. Registered Shareholders and Optionholders
may also vote online instead of by mail. Pursuant to the Interim Order, proxies, to be used at the Meeting, must be received by Computershare
Investor Services Inc. by no later than 10:00 a.m. (Vancouver time) on February 4, 2025
(or, if the Meeting is adjourned or postponed, by the time that is 48 hours prior to the Meeting, excluding
Saturdays, Sundays and holidays). To vote online at www.investorvote.com, you will need to enter your 15-digit control number
(located on the bottom left corner of the first page of the form of proxy) to identify yourself as a Registered Shareholder or Optionholder
on the voting website. Alternatively, a proxy can be submitted to Computershare Investor Services Inc. either by mail or courier, to 100
University Avenue,
8th Floor Toronto, Ontario M5J 2Y1. If a Registered Shareholder or Optionholder receives more than one proxy form because
such Registered Shareholder or Optionholder owns securities of the Company registered in different names or addresses, each proxy form
needs to be completed and returned or voted online.
If your SilverCrest Shares are not registered in your name but are
held through a broker, investment dealer, bank, trust company, custodian, nominee or other intermediary, please complete and return the
request for voting instructions in accordance with the instructions provided to you by your broker or such other intermediary. Failure
to do so may result in such securities not being voted at the Meeting.
If you wish that a person other than
the management nominees identified on the form of proxy or voting instruction form (“VIF”) attend and vote at the Meeting
as your proxy and vote your securities, including if you are not a Registered Shareholder and wish to appoint yourself as proxyholder
to attend, attend and vote at the Meeting, you MUST submit your form of proxy (or proxies) or VIF, as applicable, in accordance with the
instructions set out in the Circular. If submitting a proxy or VIF, appointing a person other than the management nominees identified,
you must return your proxy or VIF in accordance with the instructions set out in the Circular by 10:00 a.m. (Vancouver
time) on February 4, 2025 (or, if the Meeting is adjourned
or postponed, by the time that is 48 hours prior to the Meeting, excluding Saturdays, Sundays and holidays).
If you are a Registered Shareholder who is not a Dissenting Shareholder
(as defined in the Circular), please complete the Letter of Transmittal in accordance with the instructions included therein, sign, date
and return it to the depositary, Computershare Investor Services Inc. (the “Depositary”), in the envelope provided,
together with the certificates or the direct registration system advices (“DRS Advices”) representing your SilverCrest
Shares and any other required documents. If you are sending certificates, it is recommended that you send them by registered mail. The
Letter of Transmittal contains complete instructions on how to exchange your SilverCrest Shares for the Consideration under the Arrangement.
You will not receive your Consideration until after the Arrangement is completed and you have returned your properly completed documents,
including each applicable Letter of Transmittal, and the certificate(s) or DRS Advice(s) representing your SilverCrest Shares to the Depositary.
Beneficial Shareholders do not need to complete a Letter of Transmittal
and will receive the consideration to which they are entitled under the Arrangement through the intermediary.
Pursuant to the Interim Order, Registered Shareholders as at the close
of business on the Record Date have the right to dissent with respect to the Arrangement Resolution and, if the Arrangement becomes effective,
to be paid the fair value of their SilverCrest Shares in accordance with the provisions of Sections 237 to 247 of the BCBCA, as modified
by the Interim Order and the Plan of Arrangement. A Registered Shareholder as at the close of business on the Record Date wishing to exercise
rights of dissent with respect to the Arrangement must send to the Company a written objection to the Arrangement Resolution, which written
objection must be sent to the Company c/o Cassels Brock & Blackwell LLP, Suite 2200, RBC Place, 885 West Georgia Street, Vancouver,
BC V6C 3E8, Attention: Rajit Mittal, by no later than 4:00 p.m. (Vancouver time) on February 4,
2025 (or by 4:00 p.m. (Vancouver time) on the second business day immediately preceding the date that any adjourned or postponed Meeting
is reconvened), and must otherwise strictly comply with the dissent procedures set forth in Sections 237 to 247 of the BCBCA, as modified
by the Interim Order and the Plan of Arrangement, and described in the Circular. The Registered Shareholders’ right to dissent is
more particularly described in the Circular. Copies of the Plan of Arrangement, the Interim Order and the text of Sections 237 to 247
of the BCBCA are set forth in Appendix B, Appendix C and Appendix K, respectively, of the Circular. Anyone who is a beneficial owner of
SilverCrest Shares and who wishes to exercise a right of dissent should be aware that only Registered Shareholders as at the close of
business on the Record Date are entitled to exercise a right of dissent. Accordingly, a beneficial (non-registered) Shareholder who desires
to exercise a right of dissent must make arrangements for the SilverCrest Shares beneficially owned by such holder to be registered in
the name of such holder prior to the Record Date or, alternatively, make arrangements for the Registered Shareholder of such SilverCrest
Shares to exercise the right of dissent on behalf of such beneficial Shareholder. Optionholders are not entitled to exercise dissent rights.
A Registered Shareholder as at the close of business on the Record Date wishing to exercise a right of dissent may only exercise such
rights with respect to all SilverCrest Shares registered in the name of such Shareholder. It is recommended that you seek independent
legal advice if you wish to exercise a right of dissent. Failure to strictly comply with the requirements set forth in Sections 237
to 247 of the BCBCA, as modified by the Interim Order and the Plan of Arrangement, may result in the loss of any right of dissent.
The Circular provides additional information relating to the matters
to be dealt with at the Meeting and is deemed to form part of this Notice of Meeting. Any adjourned or postponed meeting resulting from
an adjournment or postponement of the Meeting will be held at a time and place to be specified either by the Company before the Meeting
or by the Chair at the Meeting.
Dated at Vancouver, British Columbia as of January 8,
2025.
BY ORDER OF THE BOARD
/s/ “N. Eric Fier”
N. Eric Fier
Chief Executive Officer and Director
 | | 2025 Special Meeting of Securityholders |
TABLE OF CONTENTS
| | | 2025 Special Meeting of Securityholders |
| | SILVERCREST METALS INC. | ii |
| | | 2025 Special Meeting of Securityholders |
| | SILVERCREST METALS INC. | iii |
| | | 2025 Special Meeting of Securityholders |
FREQUENTLY ASKED QUESTIONS
The following are some questions that you, as a Securityholder,
may have relating to the Meeting and answers to those questions. These questions and answers do not provide all of the information relating
to the Meeting or the matters to be considered at the Meeting and are qualified in their entirety by the more detailed information contained
elsewhere in, or incorporated by reference into, this Circular. You are urged to read this Circular in its entirety before making a decision
related to your SilverCrest Shares or SilverCrest Options, as applicable. All capitalized terms used herein have the meanings ascribed
to them in the “Glossary of Terms” of the Circular.
QUESTIONS RELATING TO THE ARRANGEMENT
| Q: | What am I voting on? |
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| A: | You are being asked to consider and, if deemed acceptable, to vote FOR the Arrangement Resolution,
which provides for, among other things, Coeur acquiring, through Coeur Canadian Sub, all of the issued and outstanding SilverCrest Shares.
Pursuant to the Arrangement, Shareholders will be entitled to receive 1.6022 Coeur Shares in exchange for each SilverCrest Share held. |
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| Q: | What will I receive in the Arrangement? |
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| A: | Shareholders |
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| | Shareholders (other than Dissenting Shareholders) will be entitled
to receive the Consideration, being 1.6022 Coeur Shares in exchange for each SilverCrest Share held. |
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| A: | Optionholders |
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| | Pursuant to the Plan of Arrangement, each SilverCrest Option
will be exchanged for a Replacement Option to purchase from Coeur such number of Coeur Shares (rounded down to the nearest whole number)
equal to the product of: (A) the number of SilverCrest Shares subject to such SilverCrest Option immediately prior to the Effective Time,
multiplied by (B) the Exchange Ratio, at an exercise price per Coeur Share (rounded up to the nearest whole cent) equal to (X) the exercise
price per SilverCrest Share otherwise purchasable pursuant to such SilverCrest Option immediately prior to the Effective Time, divided
by (Y) the Exchange Ratio. Except as otherwise provided for, all terms and conditions of the Replacement Options, including the term to
expiry, conditions to and manner of exercising, will be the same as the SilverCrest Option so exchanged, and shall be governed by the
terms of the applicable Company Option Plan and any document evidencing a SilverCrest Option shall thereafter evidence and be deemed to
evidence such Replacement Option, provided that the provisions of Section 7.1 of the New Company Option Plan shall apply to all Replacement
Options that would otherwise be governed by the Legacy Company Option Plan for a period of ninety (90) days following the Effective Time. |
| | |
| Q: | How do I receive my Consideration under the Arrangement as
a Shareholder? |
| | |
| A: | Each Registered Shareholder must complete the accompanying Letter of Transmittal to receive the Consideration
for such Shareholder’s SilverCrest Shares. Beneficial Shareholders should contact their Intermediary for instructions and assistance
to receive their Consideration. |
| | |
| | Optionholders do not need to take any action upon completion
of the Arrangement for their Replacement Options to be issued. |
| | |
| | For additional information, including information regarding
how the Depositary will send you the Consideration, please see “The Arrangement — Exchange of SilverCrest Securities”. |
| Q: | When can I expect to receive the Consideration? |
| | |
| A: | Assuming completion of the Arrangement, if you hold your SilverCrest Shares through an Intermediary, then
you are not required to take any action and the Consideration you are entitled to receive will be delivered to your Intermediary through |
| | | 2025 Special Meeting of Securityholders |
procedures in place for such purposes between CDS & Co. or similar entities and such Intermediaries. You should contact your Intermediary
if you have any questions regarding this process. In the case of Registered Shareholders, as soon as practical
after the Effective Date, assuming due delivery of the required documentation, including the applicable certificate(s) or DRS Advice(s)
representing SilverCrest Shares and a duly and properly completed Letter of Transmittal, Coeur will cause the Depositary to forward the
certificate(s)/DRS Advice(s) representing Coeur Shares to which the Registered Shareholders are entitled by first class mail or at the
offices of the Depositary.
The method used to deliver the Letter of Transmittal and any
accompanying certificate(s) or DRS Advice(s) representing SilverCrest Shares is at the option and risk of the Registered Shareholder and
delivery will be deemed effective only when such documents are actually received. SilverCrest recommends that the necessary documentation
be hand delivered to the Depositary at its office(s) specified on the last page of the Letter of Transmittal and a receipt obtained; otherwise,
the use of registered mail or courier with return receipt requested, properly insured, is recommended. A Beneficial Shareholder whose
SilverCrest Shares are registered in the name of a broker, investment dealer, bank, trust company or other nominee should contact that
nominee for assistance in depositing those SilverCrest Shares.
Shareholders who do not deliver their certificate(s) or
DRS Advice(s) representing SilverCrest Shares and all other required documents to the Depositary on or before the date which is six years
after the Effective Date will lose their right to receive the Consideration for their SilverCrest Shares. A Beneficial Shareholder holding
SilverCrest Shares through an Intermediary should contact that Intermediary for instructions and carefully follow any instructions provided
by such Intermediary.
For additional information, including
information regarding how the Depositary will send you the Consideration, please see “The Arrangement — Exchange of SilverCrest
Securities”.
|
Q: |
Can I exercise my vested SilverCrest Options prior to the Effective Date? |
| A: | Optionholders who intend to exercise vested SilverCrest Options in advance of the Effective Date are encouraged
to do so as soon as possible and, in any event, at least five (5) business days prior to the Effective Date. Please see “The
Arrangement – Exchange of SilverCrest Securities – Treatment of SilverCrest Options”. |
| Q: | As a holder of SilverCrest Options, what documentation do I need to submit to be able to receive the
Replacement Options? |
| A: | Optionholders do not need to submit any documentation or take any action in order to receive the Replacement
Options issuable to them under the Arrangement. |
| | |
| Q: | What is the recommendation of the SilverCrest Board of Directors? |
| A: | After taking into consideration, among other things, the Cormark Fairness Opinion and Raymond James Fairness
Opinion (as discussed further in the Circular) and the unanimous recommendation of the Special Committee, which takes into account, among
other things, the Scotiabank Fairness Opinion (as discussed further in the Circular), the directors of SilverCrest have unanimously concluded
that the Arrangement is in the best interests of the Company and the Board unanimously recommends that Securityholders vote
FOR the Arrangement Resolution. |
| | |
| Q: | Why is the SilverCrest Board of Directors making this recommendation? |
| A: | The Board, based on its considerations, investigations and deliberations,
including a thorough review of the Arrangement Agreement, the Cormark Fairness Opinion and Raymond James Fairness Opinion and other relevant
matters, and taking into account the best interests of the Company, and after
consultation with management and its financial and legal advisors and having received the unanimous recommendation of the Special Committee,
which takes into account, among other things, the Scotiabank Fairness Opinion, has unanimously determined, that the Arrangement and the
entering into of the Arrangement Agreement are in the best interests of the Company and has unanimously approved the Arrangement. |
| | | 2025 Special Meeting of Securityholders |
Accordingly,
the Board unanimously recommends that the Securityholders vote FOR the Arrangement Resolution. The following
are some of the principal reasons for the recommendation:
| · | Significant Premium. The Consideration represents an implied
value of US$11.34 per SilverCrest Share, being an 18% premium based on the 20-day volume-weighted average prices of the Coeur Shares and
SilverCrest Shares, each as at October 3, 2024 on the NYSE and NYSE American, respectively, and a 22% premium to the October 3, 2024
closing price of SilverCrest Shares on the NYSE American, being the last trading day prior to the announcement of the Arrangement. This
also represents an all-time high in the value of SilverCrest Shares for Shareholders. |
| | | |
| · | Meaningful Exposure to Diverse Asset
Portfolio. Current Shareholders will maintain exposure to the Company’s high-grade, low-cost and high-margin Las Chispas
Operation and will gain exposure to Coeur’s high quality and diversified portfolio consisting of four robust operating mines
in the U.S. and Mexico and an exploration property in Canada, with further potential upside from the district-scale exploration
potential of the Combined Company and organic mineral reserve growth. Current Shareholders will hold approximately 37% of the issued
and outstanding shares of the Combined Company upon completion of the Arrangement, based on the number of securities of Coeur and
SilverCrest issued and outstanding as of October 3, 2024. |
| | | |
| · | Creation of a Leading Global Silver Company. The addition of Las Chispas to Coeur’s growing
silver production from its recently expanded Rochester mine in Nevada and its Palmarejo underground mine in northern Mexico has the potential
to generate significant 2025 silver production of approximately 21 million ounces from five North American operations, with approximately
56% of revenue generated from U.S.-based mines and approximately 40% of revenue from silver. In addition to the significant silver production,
it is anticipated that the Combined Company can produce approximately 432,000 ounces of gold in 2025. |
| | | |
| · | Strong Cash Flow and Deleveraging of Combined Company. The Combined
Company is expected to generate approximately US$700 million of EBITDA1 and US$350 million of free cash flow1
in 2025 at lower overall costs and higher overall margins for Coeur. The Combined Company will also have more robust cash flow with the
benefit of multiple producing mines in a diversified portfolio. The strong cash flow profile of the Combined Company will be augmented
by SilverCrest’s strong balance sheet and no debt which are expected to result in an immediate 40% reduction in the Combined Company’s
leverage ratio upon closing of the Arrangement. |
| | | |
| · | Strategic Review Process and Value Maximization. The Arrangement
with Coeur is the culmination of a comprehensive strategic review process that was initiated following Las Chispas achieving commercial
production in late 2022, which process was overseen by the Board initially, and subsequently, the Special Committee, with the assistance
of the Company’s financial advisors (including Raymond James initially in late 2022 and the addition of Cormark in 2024). During
this process, the Company, through its financial advisors, canvassed numerous other potential parties to determine market interest in
a transaction involving, and explore various strategic opportunities available to, SilverCrest (including maintaining status quo, asset
purchases, merger of equals, acquisitions and a sale of the Company). This process resulted in the evaluation of over 25 potential strategic
opportunities, the execution of more than 15 confidentiality agreements, substantive reviews and site visits of more than 10 mineral properties
and multiple site visits hosted at Las Chispas. See “The Arrangement – Background to the Arrangement” for more
details on the strategic review process undertaken by the Company. After consultation on the proposed Arrangement with legal and financial
advisors, and after review of the current and prospective business climate in the precious metals mining industry and other strategic
opportunities reasonably available to SilverCrest, including continuing as an independent entity, potential acquisitions and sales, in
each case taking into account the potential benefits,
risks and uncertainties associated with those other opportunities, the Special Committee and the Board believe the Arrangement represents
SilverCrest’s best prospect for maximizing Shareholder value. |
| | | |
| · | Asset Diversification and Elimination of Single Asset Risk. The
business, operations, assets, financial condition, operating results and prospects of SilverCrest are subject to significant uncertainty,
including, but not limited to, risks associated with SilverCrest’s dependency on the Las Chispas Operation for its future operating
revenue, permitting and regulatory approvals, exploration and development risks and commodity price and inflation risks. The Combined
Company will be better positioned to pursue a growth and value maximizing strategy as compared with SilverCrest on a standalone basis,
as a result of the |
| | | 2025 Special Meeting of Securityholders |
| | | Combined
Company’s larger market capitalization, asset and geographical diversification, elimination
of single asset risk, technical expertise, greater trading liquidity, enhanced access to
capital over the long term and the likelihood of increased investor interest and access to
business development opportunities due to the Combined Company’s larger market presence. |
| · | Proven Leadership Team. Following the Arrangement, two of the
current directors of SilverCrest, Messrs. N. Eric Fier and Pierre Beaudoin, will join the board of the Combined Company. Management of
the Combined Company will feature proven and experienced mining and business leaders at both the board and executive management levels,
along with diverse, high performing teams at the regional and operating sites with a proven track record of maximizing value by delivering
long-life and profitable silver and gold mining operations. The Combined Company will continue its commitment to ESG with a specific focus
on water usage, emissions, community and workforce development, and leading governance practices. |
| | | |
| · | Fairness Opinions. The Special Committee received a fairness
opinion from Scotiabank, and the Board received a fairness opinion from each of Cormark and Raymond James, all dated October 3, 2024 to
the effect that the Consideration to be received by the Shareholders pursuant to the Arrangement is fair, from a financial point of view,
to the Shareholders, based upon and subject to various assumptions, limitations and qualifications set forth, respectively, in each such
opinion, as more fully described under “The Arrangement – Fairness Opinions”. |
For further information on the reasons
for the recommendation of the Board, please see “The Arrangement — Reasons for the Arrangement” and “The
Arrangement – Fairness Opinions” in the Circular.
|
Q: |
Has the Company received a fairness opinion in connection
with the Arrangement? |
| A: | Yes. Cormark and Raymond James have each provided a fairness opinion to the Board to the effect that,
as of the date of the Arrangement Agreement, and subject to the assumptions, limitations and qualifications described in such opinion,
the Consideration to be received by the Shareholders pursuant to the Arrangement is fair from a financial point of view to the Shareholders. |
Scotiabank has provided a fairness opinion to the Special Committee
that, as of the date of the Arrangement Agreement, and subject to the assumptions, limitations and qualifications described in such opinion,
the Consideration to be received by the Shareholders pursuant to the Arrangement is fair, from a financial point of view, to the Shareholders.
Please see “The Arrangement
– Fairness Opinions” in the Circular.
|
Q: |
What vote is required at the Meeting to approve the Arrangement Resolution? |
| A: | In order to become effective, the Arrangement Resolution must be approved
by at least (i) 66⅔%
of the votes cast by Shareholders present in person or represented by proxy and entitled to vote at the Meeting; (ii) 66⅔%
of the votes cast by Securityholders, voting together as a single class, present in person or represented by proxy and entitled to vote
at the Meeting, with Shareholders and Optionholders being entitled to one vote for each SilverCrest Share and SilverCrest Option, respectively;
and (iii) a simple majority of the votes cast by Shareholders present in person or represented by proxy and entitled to vote at the
Meeting, excluding the Excluded Shares for purposes of MI 61-101. |
If the Arrangement Resolution is not approved by the Securityholders,
the Arrangement will not be completed.
| Q: |
Who intends to support the Arrangement Resolution? |
| A: | Directors and senior officers of the Company, holding approximately 2.3% of the outstanding SilverCrest
Shares, and 3.4% of the outstanding SilverCrest Shares and SilverCrest Options collectively, each as at the Record Date, have entered
into SilverCrest Voting Agreements with Coeur, pursuant to which they have agreed to, among other things, vote FOR the Arrangement
Resolution. For more information, please see “The Arrangement – Voting and Support Agreements” in the Circular. |
| | | 2025 Special Meeting of Securityholders |
| Q: |
Is the approval of Coeur Stockholders required to complete
the Arrangement? |
| A: | Yes. The Coeur Stock Issuance and the Coeur Charter Amendment must each be approved by a majority of the
votes cast by Coeur Stockholders present in person or represented by proxy and entitled to vote at the Coeur Meeting. |
Directors and senior officers of Coeur, holding approximately
1.5% of the outstanding Coeur Shares as at the record date of the Coeur Meeting, have entered into Coeur Voting Agreements with SilverCrest,
pursuant to which they have agreed to, among other things, vote in favour of the Coeur Stock Issuance and Coeur Charter Amendment.
If the Coeur Stock Issuance or the Coeur Charter Amendment is
not approved by the Coeur Stockholders, the Arrangement will not be completed.
| Q: | In addition to the approval of Securityholders and Coeur Stockholder Approvals, are there any other
approvals required for the Arrangement? |
| A: | Yes, the Arrangement requires the approval of the Court, the approval of NYSE as to the listing of the
Coeur Shares to be issued and made issuable pursuant to the Arrangement, and the receipt of all necessary regulatory approvals, including
the COFECE Approval. See “The Arrangement – Court Approval of the Arrangement”, “The Arrangement –
Exchange Approvals” and “The Arrangement – COFECE Approval” in the Circular. |
| Q: | What if Securityholders do not approve the Arrangement Resolution? |
| | |
| A: | If the Arrangement Resolution is not approved by the Securityholders,
the Arrangement will not be completed. |
Pursuant to the terms of the Arrangement Agreement, if the SilverCrest
Securityholder Approval is not obtained by the Outside Date, either SilverCrest or Coeur may terminate the Arrangement Agreement and SilverCrest
may be required to pay the Expense Reimbursement.
| Q: | What if the Court does not approve the Arrangement? |
| A: | If the approval of the Court is not obtained prior to the Outside Date, the Arrangement will not be completed,
even if Securityholders approve the Arrangement Resolution. |
| Q: | What conditions must be satisfied to complete the Arrangement? |
| A: | The Arrangement is conditional upon the receipt of, among other things: (i) the SilverCrest Securityholder
Approval of the Arrangement Resolution; (ii) the Court’s approval; (iii) the approval of NYSE of the listing of the Coeur Shares
to be issued and made issuable pursuant to the Arrangement; (iv) the Coeur Stockholder Approvals; (v) the COFECE Approval; (vi) holders
of no more than 5% of SilverCrest Shares exercising Dissent Rights; and (vii) the satisfaction of certain other closing conditions customary
for transactions of this nature. For more information, please see “The Arrangement Agreement – Conditions to Closing”
in this Circular. |
| Q: | Do any directors or senior officers of SilverCrest have any interests in the Arrangement that are different
from, or in addition to, those of the Securityholders? |
| A: | In considering the recommendation of the Board to vote in favour of the matters discussed in this Circular,
Securityholders should be aware that some of the directors and senior officers of SilverCrest have interests in the Arrangement that are
different from, or in addition to, the interests of Securityholders generally. Please see “The Arrangement – Interests
of Certain Persons in the Arrangement” in this Circular. |
| | | 2025 Special Meeting of Securityholders |
| Q: | Will the SilverCrest Shares continue to be listed on the TSX and the NYSE American after the Arrangement? |
| A: | No. The SilverCrest Shares will be delisted from the TSX and the NYSE American after the Arrangement has
been completed and SilverCrest will become an indirect wholly-owned subsidiary of Coeur. After the Arrangement has been completed, former
Shareholders will hold Coeur Shares, which are listed on the NYSE. |
| Q: | Should I send my SilverCrest Share certificates or DRS Advices now? |
| A: | You are not required to send your certificates or DRS Advices representing SilverCrest Shares to validly
cast your vote in respect of the Arrangement Resolution. Please see “The Arrangement – Exchange of SilverCrest Securities”
in this Circular. |
Where SilverCrest Shares are evidenced only by a DRS Advice(s),
there is no requirement to first obtain a share certificate for those SilverCrest Shares. Only a properly completed and duly executed
Letter of Transmittal, accompanied by the applicable DRS Advice(s) are required to be delivered to the Depositary in order to surrender
those SilverCrest Shares under the Arrangement.
Do not send your Letter of Transmittal and certificate(s)/DRS
Advice(s) to SilverCrest. Please follow the delivery instructions set forth in the Letter of Transmittal.
| Q: | How will I know when the Arrangement will be implemented? |
| A: | The Effective Date will occur upon satisfaction or waiver of all of the conditions to the completion of
the Arrangement. If the SilverCrest Securityholder Approval is obtained at the Meeting, the Effective Date is expected to occur late in
the first quarter of 2025, subject to the satisfaction or waiver of all the conditions to the completion of the Arrangement. On the Effective
Date, SilverCrest will publicly announce that the conditions are satisfied or waived and that the Arrangement has been completed. |
| Q: | Are there risks I should consider in deciding whether to vote for the Arrangement Resolution? |
| A: | Yes. Securityholders should carefully consider the risk factors relating to the Arrangement. Some of these
risks include, but are not limited to: (i) there can be no certainty that all conditions precedent to the Arrangement will be satisfied;
(ii) the market price of the SilverCrest Shares and Coeur Shares may be materially adversely affected if the Arrangement is not completed;
(iii) the Arrangement Agreement may be terminated in certain circumstances; (iv) the completion of the Arrangement is uncertain and SilverCrest
will incur costs and may have to pay the Company Termination Payment or the Expense Reimbursement under certain circumstances; (v) the
Combined Company may not recognize certain anticipated benefits of the Arrangement; (vi) the Arrangement may divert the attention of SilverCrest’s
management; (vii) the Company Termination Payment provided under the Arrangement Agreement may discourage other parties from attempting
to acquire SilverCrest; (viii) SilverCrest is restricted from taking certain actions while the Arrangement is pending; (ix) the Coeur
Shares issued in connection with the Arrangement may have a market value different than expected; (x) directors and senior officers of
SilverCrest have interests in the Arrangement that may be different from those of Securityholders generally; (xi) Coeur and SilverCrest
may be the targets of legal claims, securities class action, derivative lawsuits and other claims; (xii) the Board considered financial
projects prepared by SilverCrest management in connection with the Arrangement, and actual performance of Coeur and SilverCrest may differ
materially from these projections; (xiii) unaudited pro forma condensed combined financial statements may not be indicative of
the results of operations or financial condition of
the Combined Company; and (xiv) as a holder of Coeur Shares, you will be subject to the risks associated with an investment in Coeur.
Please see “Risk Factors” in this Circular. |
| Q: | What are the Canadian income tax consequences of the Arrangement? |
| A: | For a summary of certain material Canadian income tax consequences of the Arrangement, please see “Certain
Canadian Federal Income Tax Considerations” in this Circular. Such summary is not intended to be legal or tax advice to any
particular Securityholder. Securityholders should consult their own tax and investment advisors with respect to their particular circumstances. |
| | | 2025 Special Meeting of Securityholders |
| Q: | What are the U.S. federal income tax consequences of the Arrangement? |
| A: | For a summary of certain material U.S. federal income tax consequences of the Arrangement, please see
“Certain United States Federal Income Tax Consequences of the Arrangement” in this Circular. Such summary is not intended
to be legal or tax advice to any particular Securityholder. Securityholders should consult their own tax and investment advisors with
respect to their particular circumstances. |
| Q: | What will happen to the SilverCrest Shares that I currently own after completion of the Arrangement? |
| A: | Upon completion of the Arrangement, certificate(s) or DRS Advice(s) representing SilverCrest Shares will
represent only the right of the Registered Shareholder to receive the Consideration for each SilverCrest Share held in accordance with
the procedures set out in the Circular. It is expected that trading in SilverCrest Shares on the TSX and NYSE American will cease approximately
two to three trading days after completion of the Arrangement and SilverCrest will terminate its status as a reporting issuer under Canadian
Securities Laws and as a registrant under U.S. Securities Laws and will cease to be required to file reports with the applicable Canadian
Securities Authorities and the SEC. The Coeur Shares are expected to continue to be listed on the NYSE. |
QUESTIONS RELATING TO THE MEETING
| Q: | When and where is the Meeting? |
| A: | The Meeting will take place on February
6, 2025 at 10:00 a.m. (Vancouver time) at the offices of Cassels Brock & Blackwell LLP at Suite 2200, RBC Place, 885 West Georgia
Street, Vancouver, British Columbia. The Meeting can also be accessed via live webcast at meetnow.global/MHZWLAD. Any Securityholder attending
the live webcast will not be able to vote during the Meeting. Only Securityholders or their duly appointed proxyholders who are present
in person at the Meeting are able to vote during the Meeting. |
| Q: | Who is soliciting my proxy? |
| A: | Your proxy is being solicited by management of SilverCrest. This Circular is furnished in connection with
that solicitation. The solicitation of proxies for the Meeting will be made primarily by mail, and may be supplemented by telephone and
other means of contact. In addition, SilverCrest has engaged Laurel Hill as its proxy solicitation agent, to assist in the solicitation
of proxies with respect to the matters to be considered at the Meeting. |
If you have questions or require voting assistance, please contact
Laurel Hill by telephone at 1.877.452.7184 (toll-free in North America) or 416.304.0211 (collect outside North America) or by email at
assistance@laurelhill.com.
| Q: | Who can attend and vote at the Meeting and what is the quorum for the Meeting? |
| A: | Only holders of SilverCrest Shares and SilverCrest Options of record as of the close of business on December
19, 2024, the Record Date for the Meeting, are entitled to receive notice of, attend and vote at, the Meeting or any adjournment(s) or
postponement(s) of the Meeting. |
For all purposes contemplated by this Circular, the quorum for
the transaction of business at the Meeting will be two Shareholders, present in person or represented by proxy, holding in the aggregate
at least 5% of the issued shares entitled to be voted at the Meeting.
| A: | There are different ways to submit your voting instructions depending on whether you are a Registered
Shareholder, Optionholder or a Beneficial Shareholder. |
| · | Registered Shareholders and Optionholders: You must be a Registered
Shareholder or Optionholder at the close of business on the Record Date to vote. You may vote in person or by proxy. |
| | | 2025 Special Meeting of Securityholders |
| · | Beneficial Shareholders: You may vote or appoint a proxy using
the VIF provided to you. Your vote or proxy appointment will be submitted by your bank, trust company, securities broker, trustee, custodian
or other nominee who holds SilverCrest Shares on your behalf to the Company. |
| |
|
Registered Shareholders and Optionholders |
Beneficial Shareholders
(Common Shares held with a broker, bank or other
intermediary.) |
 |
Internet |
www.investorvote.com |
www.proxyvote.com |
 |
Telephone |
1-866-732-8683 |
Dial the applicable number listed on the voting instruction form. |
 |
Mail |
Return the voting instruction form in the enclosed postage paid envelope. |
Return the voting instruction form in the enclosed postage paid envelope. |
For more information, please see “How do I appoint
a third party as my proxyholder?”, and “Information Concerning the Meeting – Appointment of Proxyholders”
and “Information Concerning the Meeting – Advice to Beneficial (Non-Registered) Shareholders”.
| Q: | How do I know if I am a Registered Shareholder or a Beneficial Shareholder? |
| | |
| A: | You may own SilverCrest Shares in one or both of the following
ways: |
| · | If you are in possession of a physical share certificate or DRS Advice,
you are a Registered Shareholder and your name and address are known to us through our Transfer Agent. |
| · | If you own SilverCrest Shares through an Intermediary, you are a Beneficial
Shareholder and you will not have a physical share certificate or a DRS Advice. In this case, you will have an account statement from
your bank or broker as evidence of your share ownership. |
Most Shareholders are Beneficial Shareholders. Their SilverCrest
Shares are registered in the name of an Intermediary, such as a bank, trust company, securities broker, trustee, custodian or other nominee
who holds SilverCrest Shares on their behalf, or in the name of a clearing agency in which the Intermediary is a participant (such as
CDS & Co.). Intermediaries have obligations to forward the Meeting materials to such Beneficial Shareholders unless otherwise instructed
by the holder (and as required by regulation in some cases, despite such instructions).
| Q: | If my SilverCrest Shares are held in the name of an Intermediary, will they automatically vote my SilverCrest
Shares for me? |
| A: | No. Specific voting instructions must be provided. Please see “How do I vote if my SilverCrest
Shares are held in the name of an Intermediary?” below. |
| Q: | How do I vote if my SilverCrest Shares are held in the name of an Intermediary? |
| A: | Fill in the VIF you received with this package and carefully follow the instructions provided. You can
send your voting instructions by phone or by mail or through the internet. |
Only Registered Shareholders or the persons they
appoint as proxies, are permitted to attend and vote at the Meeting.
To attend and vote at the Meeting, Beneficial Shareholders should
insert his or her name or his or her chosen representative (who need not be a Securityholder) in the blank space provided in the VIF and
follow the instructions on returning the form.
| | | 2025 Special Meeting of Securityholders |
Please see “How do I appoint a third party as my proxyholder?”
below for more information on how Beneficial Shareholders can appoint third parties as proxyholders.
| Q: | How do I appoint a third party as my proxyholder? |
| A: | The following applies to Registered Shareholders and Optionholders who wish to appoint a person other
than the management nominees set forth in the form of proxy as proxyholder, and Beneficial Shareholders who wish to appoint themselves
as proxyholder to participate and vote at the Meeting. |
You have the right to appoint any person or company you want
to be your proxyholder. It does not have to be a Securityholder or the person designated in the enclosed form(s). Simply indicate the
person’s name as directed on the enclosed proxy form(s) or complete any other legal proxy form and deliver it to Computershare Investor
Services Inc. within the time hereinafter specified for receipt of proxies.
Securityholders who wish to appoint a third-party proxyholder
to attend or vote at the Meeting as their proxy and vote their securities MUST submit their proxy (or proxies) or VIF, as applicable,
appointing such third-party proxyholder in accordance with the instructions provided in the proxy or VIF, as applicable.
If you are a Beneficial Shareholder and wish to attend
or vote at the Meeting, you have to insert your own name in the space provided on the VIF sent to you by your Intermediary, follow all
of the applicable instructions provided by your Intermediary. By doing so, you are instructing your Intermediary to appoint you
as proxyholder. It is important that you comply with the signature and return instructions provided by your Intermediary.
| Q: | How many SilverCrest Securities are entitled to vote? |
| A: | As of the Record Date, there were 149,188,518 SilverCrest Shares and 2,365,586 SilverCrest Options outstanding
and entitled to vote at the Meeting. Each SilverCrest Share and SilverCrest Option entitled to be voted at the Meeting will entitle the
holder thereof to one vote at the Meeting for each SilverCrest Share and SilverCrest Option held, respectively. Apart from the approvals
required by Shareholders voting alone, the Securityholders will vote together as a single class. |
| Q: | What if I return my proxy but do not mark it to show how I wish to vote? |
| A: | If your proxy is signed and dated and returned without specifying your choice or is returned specifying
both choices, your SilverCrest Shares and/or SilverCrest Options, as applicable, will be voted FOR the Arrangement Resolution
in accordance with the recommendation of the Board. |
| Q: | When is the cut-off time for delivery of proxies? |
| A: | Proxies sent by mail or courier must be delivered to Computershare Investor Services Inc., not less than
48 hours (excluding Saturdays, Sundays and holidays) before the time of the Meeting or any adjournment thereof. In this case, assuming
no adjournment, the proxy cut-off time is 10:00 a.m. (Vancouver time) February 4, 2025.
Online votes submitted via the internet at www.investorvote.com must also be submitted by 10:00 a.m. (Vancouver time) on February
4, 2025. The Chair of the Meeting, in his or her sole discretion, may accept late proxies
or waive the deadline for accepting proxies. |
A Beneficial Shareholder exercising voting rights through an
Intermediary should consult the VIF from such Beneficial Shareholder’s Intermediary as the Intermediary may have earlier deadlines.
| Q: | Can I change my vote after I submitted a signed proxy? |
| A: | Yes. If you want to change your vote after you have delivered a proxy, you can do so by submitting a new,
later dated, proxy before the proxy cut-off time. |
| | | 2025 Special Meeting of Securityholders |
| Q: | Am I entitled to Dissent Rights? |
| A: | If you are a Registered Shareholder as at the close of business on the Record Date who duly and validly
exercises Dissent Rights and the Arrangement Resolution is approved, you will be entitled to be paid the fair value of all, but not less
than all, of your SilverCrest Shares calculated as of the close of business on the day before the Arrangement Resolution was adopted.
This amount may be the same as, more than or less than the Consideration per SilverCrest Share that will be paid under the Arrangement. |
If you wish to dissent, you must ensure that a written notice
is received by SilverCrest not later than 4:00 p.m. (Vancouver time) on February 4, 2025
(or by 4:00 p.m. (Vancouver time) on the second business day immediately preceding the date that any adjourned or postponed Meeting is
reconvened), and must otherwise strictly comply with the dissent procedures set forth in Sections 237 to 247 of the BCBCA, as modified
by the Interim Order and the Plan of Arrangement, and described in the Circular under “The Arrangement – Dissenting Shareholders’
Rights”.
Failure to strictly comply with the requirements set forth in
Sections 237 and 247 of the BCBCA, as modified by the Interim Order and the Plan of Arrangement, may result in the loss of any right of
dissent.
| Q: | How can I revoke my proxy? |
| A: | If you change your vote by submitting a new, later dated, proxy before the proxy cut-off, such change
will revoke any previously filed proxy. |
Also, you can revoke your proxy without a new vote by signing
a written statement which indicates, clearly, that you want to revoke your proxy and delivering this signed written statement to the registered
office of SilverCrest at 19th Floor, 885 West Georgia Street, Vancouver, British Columbia V6C 3H4, or in any other manner permitted
by law.
Your proxy will only be revoked if a revocation is received
by 4:00 p.m. (Vancouver time) on the last business day before the day of the Meeting, or delivered to the person presiding at the Meeting
before it commences. If you revoke your proxy and do not replace it with another that is deposited with us before the deadline, you can
still vote your SilverCrest Shares and/or SilverCrest Options, but to do so you must attend the Meeting and follow the procedures for
voting in person.
Beneficial Shareholders should follow instructions
provided to them by their Intermediary with respect to their VIF.
| Q: | Who to Call with Questions |
| A: | Securityholders who have questions or need assistance with voting their SilverCrest Shares or
SilverCrest Options, as applicable, should contact Laurel Hill by telephone at 1.877.452.7184 (toll-free in North America) or 416.304.0211 (collect outside North America) or by email at
assistance@laurelhill.com. Please see “Other Information – Additional Information” in this Circular. |
If you have questions about deciding how to vote on the Arrangement
Resolution, you should contact your own legal, tax, financial or other professional advisor.
| | SILVERCREST METALS INC. | 10 |
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MANAGEMENT INFORMATION CIRCULAR
Introduction
This Circular is furnished in connection with the solicitation
of proxies by and on behalf of the management of the Company for use at the Meeting and any adjournment or postponement thereof. No person
has been authorized to give any information or make any representation in connection with the Arrangement or any other matters to be considered
at the Meeting other than those contained in this Circular and, if given or made, any such information or representation must not be relied
upon as having been authorized and should not be relied upon in making a decision as to how to vote on the Arrangement.
These Meeting materials are being sent to registered holders of SilverCrest
Shares and beneficial owners of SilverCrest Shares through Intermediaries, and to Optionholders.
If you hold SilverCrest Shares through an Intermediary, you should
contact your Intermediary for instructions and assistance in voting and surrendering the SilverCrest Shares that you beneficially own.
Information Contained in this Circular
The information contained in this Circular is given as at January
8, 2025, except where otherwise noted. This Circular does not constitute the solicitation
of an offer to purchase any securities or the solicitation of a proxy by any person in any jurisdiction in which such solicitation is
not authorized or in which the person making such solicitation is not qualified to do so or to any person to whom it is unlawful to make
such solicitation.
Information contained in this Circular should not be construed as
legal, tax or financial advice and Securityholders are urged to consult their own professional advisors in connection therewith.
THIS CIRCULAR AND THE TRANSACTIONS CONTEMPLATED BY THE ARRANGEMENT
AGREEMENT AND THE PLAN OF ARRANGEMENT HAVE NOT BEEN APPROVED OR DISAPPROVED BY ANY SECURITIES REGULATORY AUTHORITY NOR HAS ANY SECURITIES
REGULATORY AUTHORITY PASSED UPON THE FAIRNESS OR MERITS OF SUCH TRANSACTIONS OR UPON THE ACCURACY OR ADEQUACY OF THE INFORMATION CONTAINED
IN THIS CIRCULAR. ANY REPRESENTATION TO THE CONTRARY IS AN OFFENCE.
Descriptions in this Circular of the terms of the Arrangement Agreement,
the Plan of Arrangement, the SilverCrest Voting Agreements and the Coeur Voting Agreements are summaries of the terms of those documents
and are qualified in their entirety by such terms. Securityholders should refer to the full text of the Arrangement Agreement, the Plan
of Arrangement, the SilverCrest Voting Agreements and the Coeur Voting Agreements for complete details of those documents. The Arrangement
Agreement and the forms of SilverCrest Voting Agreements and Coeur Voting Agreements appended thereto have been filed by SilverCrest under
its profile on SEDAR+ at www.sedarplus.ca and on EDGAR at www.sec.gov. The Plan of Arrangement is attached as Appendix B
to this Circular.
Information Concerning Coeur
The information concerning Coeur and its subsidiaries contained in
this Circular has been provided by Coeur for inclusion in this Circular and should be read together with, and is qualified by, the documents
filed by Coeur with the SEC and the applicable Canadian Securities Authorities that are incorporated by reference herein. Although the
Company has no knowledge that any statements contained herein taken from or based on such information provided by Coeur are untrue or
incomplete, the Company assumes no responsibility for the accuracy of such information, or for any failure by Coeur or any of its subsidiaries
or any of their respective representatives to disclose events which may have occurred or may affect the significance or accuracy of any
such information but which are unknown to the Company. In accordance with the Arrangement Agreement, Coeur provided the Company with all
necessary information concerning Coeur that is required by applicable Laws to be included in this Circular and ensured that such information
does not contain any misrepresentations.
Non-GAAP Financial Performance Measures
This Circular and the documents incorporated by reference that relate
to SilverCrest present certain measures, including average realized gold and silver price, capital expenditures, adjusted earnings, free
cash flow, working capital, operating cash flow before
| | SILVERCREST METALS INC. | 11 |
| | | 2025 Special Meeting of Securityholders |
change in working capital, treasury assets, cash costs, all-in sustaining costs
and operating margin. In addition, this Circular and certain documents incorporated by reference that relate to Coeur and/or the Combined
Company present certain measures, including adjusted net income/loss, EBITDA and adjusted EBITDA, free cash flow, operating cash flow
before changes in working capital, net debt and leverage ratio and costs applicable to sales.
The foregoing measures (collectively, the “non-GAAP measures”)
are not standardized financial measures under IFRS Accounting Standards (in the case of SilverCrest) or under GAAP (in the case of Coeur),
and therefore may not be comparable to similar financial measures presented by other issuers. As there is no standardized method of calculating
any of these non-GAAP measures, the method of calculating each of them may differ from the methods used by other entities and, accordingly,
the use of any of these measures may not be directly comparable to similarly titled measures used by other entities. Accordingly, these
measures are intended to provide additional information and should not be considered in isolation or as a substitute for measures of performance
prepared in accordance with IFRS Accounting Standards (in the case of SilverCrest) or GAAP (in the case of Coeur).
The reconciliation of the non-GAAP measures used and presented by
SilverCrest to the most directly comparable IFRS Accounting Standards measures is provided in certain documents incorporated by reference
herein in which these non-GAAP measures are referenced. See the section “Non-GAAP Financial Measures” on page 16 of the Company
Annual MD&A and “Non-GAAP Financial Measures” on page 14 of the management’s discussion and analysis of the Company
for the three and nine months ended September 30, 2024, each of which is incorporated by reference in this Circular and available on SEDAR+
at www.sedarplus.ca and on EDGAR at www.sec.gov.
The reconciliation of the non-GAAP measures used and presented by
Coeur to the most directly comparable GAAP measures is provided in certain documents incorporated by reference herein in which these non-GAAP
measures are referenced. See the section “Non-GAAP Financial Performance Measures” on page 54 of the Coeur Annual Report,
which is incorporated by reference in this Circular and available on EDGAR at www.sec.gov and on SEDAR+ at www.sedarplus.ca.
Pro Forma Financial Information
The unaudited pro forma condensed combined financial statements
included in this Circular give effect to the Arrangement and certain related adjustments described in the notes accompanying such financial
statements. The unaudited pro forma condensed combined balance sheet as at September 30, 2024 gives effect to the Arrangement as
if the Arrangement was completed on September 30, 2024. The unaudited pro forma condensed combined statements of operations
for the year ended December 31, 2023 and for the nine months ended September 30, 2024 give effect to the Arrangement as if all
such transactions had closed on January 1, 2023. The unaudited pro forma condensed combined financial statements are based on the
respective historical audited consolidated financial statements of SilverCrest and Coeur each as at and for the year ended December 31,
2023, and the unaudited condensed consolidated interim financial statements of SilverCrest and Coeur each as at and for the nine months
ended September 30, 2024. The unaudited pro forma condensed combined financial statements should be read together with: (i) the
Company Annual Financial Statements incorporated by reference into this Circular, (ii) the Coeur Annual Financial Statements incorporated
by reference into this Circular, (iii) the Company Interim Financial Statements incorporated by reference into this Circular, (iv) the
Coeur Interim Financial Statements incorporated by reference in this Circular, and (v) other information contained in or incorporated
by reference into this Circular. SilverCrest’s historical consolidated annual financial statements were prepared in accordance with
IFRS Accounting Standards and historical quarterly statements were prepared in accordance with IAS 34, both of which differ in certain
respects from GAAP. Adjustments were made to SilverCrest’s financial statements to convert those from IFRS Accounting Standards
to GAAP as well as reclassifications to conform SilverCrest’s historical accounting presentation to Coeur’s accounting presentation.
See Appendix J “Unaudited Pro Forma Financial Information” in this Circular.
The final purchase consideration will be based on the closing price
per Coeur Share on the closing date of the Arrangement, which could differ materially from the assumed price per Coeur Share used to
estimate purchase consideration for the purposes of the unaudited pro forma condensed combined financial statements included
in this Circular. For purposes of the unaudited pro forma condensed combined financial statements, such Coeur Shares and
equity awards are assumed to remain outstanding as of the closing date of the Arrangement. Further, no effect has been given to any
other new SilverCrest Shares or other equity awards that may be issued or granted subsequent to the date of this Circular and before
the closing date of the Arrangement. In all cases in which the closing price per Coeur Share is a determining factor in arriving at
the final purchase consideration, the stock price assumed for the total preliminary purchase price is the closing price per Coeur
Share as of October 3, 2024 ($7.08 per Coeur Share). A hypothetical 10 percent change in the price per Coeur Share as of
October 3, 2024, would have an approximate $169.6 million impact on the purchase
| | SILVERCREST METALS INC. | 12 |
| | | 2025 Special Meeting of Securityholders |
price, which would result in
$169.6 million additional goodwill or a reduction to goodwill of $169.6 million. The closing price of Coeur Shares on the
NYSE on January 7, 2025, the last trading day prior to the date of the Circular, was $6.13.
The unaudited pro forma condensed combined financial statements
are presented for illustrative purposes only and do not necessarily reflect what the Combined Company’s financial condition and
results of operations following completion of the Arrangement would have been had the Arrangement occurred on the dates indicated. It
also may not be useful in predicting the future financial condition and results of the operations of the Combined Company following completion
of the Arrangement. The actual financial position and results of operations of the Combined Company following completion of the Arrangement
may differ significantly from the pro forma amounts reflected in the unaudited pro forma condensed combined financial statements
due to a variety of factors.
The unaudited pro forma information and adjustments, including
the allocation of the purchase price, are based upon preliminary estimates of fair values of assets acquired and liabilities assumed,
current available information and certain assumptions that Coeur believes are reasonable in the circumstances, as described in the notes
to the unaudited pro forma condensed combined financial information. The actual adjustments to the consolidated financial statements
of Coeur upon closing of the Arrangement will depend on a number of factors, including, among others, the price of Coeur Shares used to
value the Consideration, the actual expenses of the Arrangement and other additional information that becomes available after the date
of this Circular. As a result, it is expected that actual adjustments will differ from the pro forma adjustments, and the differences
may be material. See “Management Information Circular – Forward-Looking Information” and “Risk Factors”.
Presentation of Financial Information and Currency Exchange Rates
Both SilverCrest and Coeur report in U.S. dollars. The historical
financial statements and all other financial information of SilverCrest and Coeur included or incorporated by reference in this Circular
are reported in U.S. dollars and have been prepared in accordance with IFRS Accounting Standards (in the case of SilverCrest) or GAAP
(in the case of Coeur).
The financial statements of SilverCrest and Coeur were each audited
in accordance with the standards of the PCAOB. The unaudited pro forma condensed combined financial information included in this
Circular are reported in U.S. dollars and have been prepared by Coeur management in accordance with the recognition and measurement principles
of GAAP.
In this Circular, references to “$” or “US$”
are to amounts in United States dollars and references to “C$” are to amounts in Canadian dollars, unless otherwise indicated.
The following table sets forth, for each period indicated, the high
and low exchange rates, the average exchange rate, and the exchange rate at the end of the period, based on the rate of exchange of one
U.S. dollar in exchange for Canadian dollars published by the Bank of Canada.
| |
Year ended
December 31 |
Nine months ended
September 30 |
| |
2023
C$ |
2022
C$ |
2024
C$ |
2023
C$ |
| High |
1.3875 |
1.3856 |
1.3858 |
1.3807 |
| Low |
1.3128 |
1.2451 |
1.3316 |
1.3128 |
| Average |
1.3497 |
1.3013 |
1.3604 |
1.3457 |
| Closing |
1.3226 |
1.3544 |
1.3499 |
1.3520 |
On October 3, 2024, the business day immediately prior to the announcement
of the Arrangement, the average daily exchange rate as reported by the Bank of Canada was US$1.00 = C$1.3540 or C$1.00 = US$0.7386. On
January 7, 2025, the average daily exchange rate as reported by the Bank of Canada was US$1.00 = C$1.4340 or C$1.00 = US$0.6974.
| | SILVERCREST METALS INC. | 13 |
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Scientific and Technical Information
All mineral reserves and mineral resources for SilverCrest have been
estimated in accordance with the standards of the CIM and NI 43-101. All mineral resources are reported exclusive of mineral reserves.
Mineral resources that are not mineral reserves do not have demonstrated economic viability. Information on data verification performed
on the Las Chispas Operation which is the sole mineral property considered to be material to the Company are contained in the Company
AIF incorporated by reference into this Circular, and the Company Technical Report is available under SilverCrest’s profile on SEDAR+
at www.sedarplus.ca or on EDGAR at www.sec.gov. See “Information Concerning SilverCrest – Interests of Experts”.
Cautionary Note to Securityholders in the United
States Concerning Estimates of Measured, Indicated and Inferred Mineral Resources
This Circular has been prepared in accordance with Canadian standards
for the reporting of mineral resource and mineral reserve estimates, which differ from the previous and current standards of the United
States securities laws. In particular, and without limiting the generality of the foregoing, the terms “mineral reserve”,
“proven mineral reserve”, “probable mineral reserve”, “inferred mineral resources”, “indicated
mineral resources”, “measured mineral resources” and “mineral resources” used or referenced herein and the
documents incorporated by reference herein, as applicable, are Canadian mineral disclosure terms as defined in accordance with NI 43-101
and the CIM Definition Standards.
In contrast, the SEC’s rules for disclosure regarding mineral
properties, including with respect to estimates of mineral reserves and mineral resources, are set for in subpart 1300 of Regulation S-K
(“Subpart 1300”), which differs in certain material respects from NI 43-101. As a foreign private issuer that is eligible
to file reports with the SEC pursuant to the multi-jurisdictional disclosure system, the Company is not required to provide disclosure
on its mineral properties under Subpart 1300. Accordingly, readers are cautioned that information regarding the Company’s mineral
properties, including with respect to estimates of mineral reserves and mineral resources, contained or incorporated by reference herein
are not directly comparable with, and may differ in certain material respects from, similar information disclosed by United States companies
that disclose information regarding mineral properties in accordance with Subpart 1300.
Information for U.S. Securityholders
The Company is a corporation existing under the laws of British Columbia
and is a “foreign private issuer” as defined in Rule 405 under the U.S. Securities Act and Rule 3b-4 under the U.S. Exchange
Act. The solicitation of proxies and the transactions contemplated in this Circular are not subject to the proxy rules under Section 14(a)
of the U.S. Exchange Act by virtue of an exemption for foreign private issuers, and therefore this solicitation is not being effected
in accordance with U.S. Securities Laws. Accordingly, the solicitation and transactions contemplated in this Circular are made in the
United States for securities of a Canadian issuer in accordance with Canadian corporate laws and Securities Laws, and this Circular has
been prepared in accordance with disclosure requirements applicable in Canada. Securityholders in the United States should be aware that
disclosure requirements under Canadian laws are different from those of the United States applicable to registration statements under
the U.S. Securities Act and proxy statements under the U.S. Exchange Act. Securityholders in the United States should also be aware that
other requirements under Canadian laws may differ from those required under United States corporate laws and U.S. Securities Laws.
THE COEUR SHARES ISSUABLE IN CONNECTION WITH THE ARRANGEMENT HAVE
NOT BEEN APPROVED OR DISAPPROVED BY THE UNITED STATES SECURITIES AND EXCHANGE COMMISSION OR SECURITIES REGULATORY AUTHORITIES IN ANY STATE,
NOR HAS THE UNITED STATES SECURITIES AND EXCHANGE COMMISSION OR THE SECURITIES REGULATORY AUTHORITIES OF ANY STATE PASSED UPON THE ADEQUACY
OR ACCURACY OF THIS INFORMATION CIRCULAR. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
The Coeur Shares and Replacement Options are
being issued in reliance on the exemption from the registration requirements of the U.S. Securities Act set forth in Section
3(a)(10) thereof on the basis of the approval of the Court, and similar exemptions from registration under applicable state
Securities Laws. Section 3(a)(10) of the U.S. Securities Act exempts the issuance of any securities issued in exchange for one or
more bona fide outstanding securities from the registration requirements under the U.S. Securities Act where the terms and
conditions of the issuance and exchange of such securities have been approved by a court of competent jurisdiction that is expressly
authorized by law to grant such approval, after a hearing upon the substantive and procedural fairness of the terms and conditions
of such issuance and exchange at which all persons to whom it is proposed to issue the securities have the
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right to appear and
receive timely and adequate notice thereof. The Court is authorized to conduct a hearing at which the substantive and procedural
fairness of the terms and conditions of the Arrangement will be considered. The Court issued the Interim Order on January 8, 2025
and, subject to the approval of the Arrangement by the Securityholders, a hearing of the application for the Final Order is
currently scheduled to take place on February 11, 2025 at 9:45 a.m. (Vancouver time), or as soon thereafter as counsel may be heard.
All Securityholders are entitled to appear and be heard at this hearing. The Final Order will be relied upon as a basis for the
exemption from the registration requirements of the U.S. Securities Act provided by Section 3(a)(10) thereof with respect to the
Coeur Shares and Replacement Options to be received by Securityholders pursuant to the Arrangement in exchange for their SilverCrest
Shares and SilverCrest Options, respectively. Prior to the hearing on the Final Order, the Court will be informed that the parties
will so rely upon the Final Order.
The exemption from the registration requirements of the U.S. Securities
Act provided by Section 3(a)(10) of the U.S. Securities Act does not exempt the issuance of securities upon the exercise of the Replacement
Options. As a result, the Coeur Shares issuable upon exercise of the Replacement Options after the Effective Date may not be issued in
reliance upon Section 3(a)(10) of the U.S. Securities Act and the Replacement Options may only be exercised pursuant to an available exemption
from the registration requirements of the U.S. Securities Act and applicable state Securities Laws (in which case they will be “restricted
securities” within the meaning of Rule 144) or following registration under such laws, if any, or pursuant to a registration statement
under the U.S. Securities Act.
This Arrangement has not been approved or disapproved by the United
States Securities and Exchange Commission or any other securities regulatory authority, nor has any securities regulatory authority passed
upon the fairness or the merits of this transaction or upon the accuracy or adequacy of the information contained in this Circular.
Securityholders in the United States should be aware that the financial
statements and financial information of the Company are prepared in accordance with IFRS Accounting Standards (annual statements) and
IAS 34 (quarterly statements), which differ in certain material respects from GAAP and thus may not be comparable in all respects to financial
statements and information of United States companies.
Securityholders should be aware that the acquisition of the securities
described herein may have tax consequences both in the United States and in Canada. Such consequences for investors who are resident in,
or citizens of, the United States are not described herein. U.S. Securityholders should consult their own tax advisors with respect to
their own particular circumstances.
The enforcement by investors of civil liabilities under the U.S. Securities
Laws may be affected adversely by the fact that SilverCrest is incorporated outside the United States, that some or all of SilverCrest’s
officers and directors and the experts named herein are not residents of the United States, and that all or a substantial portion of the
assets of SilverCrest and said persons are located outside the United States. As a result, it may be difficult or impossible for U.S.
Securityholders to effect service of process within the United States upon SilverCrest, its officers or directors or the experts named
herein, or to realize against them upon judgments of courts of the United States predicated upon civil liabilities under the federal securities
laws of the United States or “blue sky” laws of any state within the United States. In addition, U.S. Securityholders should
not assume that the courts of Canada: (a) would enforce judgments of United States courts obtained in actions against such persons predicated
upon civil liabilities under the federal securities laws of the United States or “blue sky” laws of any state within the United
States; or (b) would enforce, in original actions, liabilities against such persons predicated upon civil liabilities under the federal
securities laws of the United States or “blue sky” laws of any state within the United States.
No broker, dealer, salesperson or other person has been authorized
to give any information or make any representation other than those contained in this Circular and, if given or made, such information
or representation must not be relied upon as having been authorized by SilverCrest or Coeur.
Forward-Looking Information
This Circular contains forward-looking statements and forward-looking
information within the meaning of applicable Securities Laws and which are based on the currently available competitive, financial and
economic data and operating plans of management of the Company as of the date hereof unless otherwise stated. Forward-looking statements
are provided for the purpose of presenting information about management’s current expectations and plans relating to the future
and readers are cautioned that such statements may not be appropriate for other purposes. The use of any of the words “may”,
“will”, “plan”, “expect”, “anticipate”, “estimate”, “intend”,
“indicate”, “scheduled”, “target”, “goal”, “potential”, “subject”,
“efforts”, “option” or the negative of such terms and similar
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expressions are intended to identify forward-looking
statements or information. More particularly and without limitation, this Circular contains forward-looking statements and information
concerning: the Arrangement and the completion thereof; covenants of SilverCrest and Coeur in relation to the Arrangement; the timing
for the implementation of the Arrangement, including the expected Effective Date of the Arrangement; the anticipated benefits of the Arrangement;
the principal steps of the Arrangement; the process and timing of delivery of the Consideration to Securityholders following the Effective
Time; the receipt of the SilverCrest Securityholder Approval and Coeur Stockholder Approvals; the receipt of the COFECE Approval; the
anticipated tax treatment of the Arrangement for Securityholders; statements made in, and based upon the Fairness Opinions; statements
relating to the business of Coeur, SilverCrest and the Combined Company after the date of this Circular and prior to, and after, the Effective
Time; the impact of the Arrangement on employees and local stakeholders; the strengths, characteristics, market position, and future financial
or operating performance and potential of the Combined Company; the amounts received by the directors and senior officers of SilverCrest
under the Arrangement; de-listing of the SilverCrest Shares from the TSX and NYSE American; ceasing of reporting issuer status of SilverCrest;
the listing of the Coeur Shares issuable pursuant to the Arrangement on the NYSE; the availability of the exemption under Section 3(a)(10)
of the U.S. Securities Act for the securities issuable pursuant to the Arrangement; the transfer restrictions (or lack thereof) with respect
to the Coeur Shares issued to Shareholders upon the completion of the Arrangement; the liquidity of Coeur Shares following the Effective
Time; the market price of Coeur Shares; the number of Coeur Shares expected to be issued pursuant to the Arrangement; the expected ownership
of Coeur Shares by Shareholders and existing Coeur Stockholders upon completion of the Arrangement; anticipated developments in the operations
of SilverCrest and Coeur; expectations regarding the growth of Coeur and the Combined Company, including the Combined Company’s
future financial condition, results of operations, strategy and plans; the ability of the Combined Company to realize anticipated synergies
in the timeframe expected or at all; changes in capital markets and the ability of the Combined Company to finance operations in the manner
expected; the business prospects and opportunities of SilverCrest, Coeur and the Combined Company; estimates of mineral resources and
mineral reserves; the future demand for and prices of commodities; the future size and growth of metals markets; the timing and amount
of estimated future production of SilverCrest, Coeur and the Combined Company; expectations regarding costs of production and capital
and operating expenditures; estimates of the mine life of mineral projects; expectations regarding the costs and timing of exploration
and development, and the success of such activities; sales expectations; the timing and possible outcome of pending litigation in future
periods; the timing and possible outcome of regulatory and permitted matters; goals; strategies; future growth; planned future acquisitions
(other than the Arrangement); the adequacy of financial resources; and other events or conditions that may occur in the future or future
plans, projects, objectives, estimates and forecasts, and the timing related thereto.
In respect of the forward-looking statements and information in this
Circular, the Company has provided such forward-looking statements and information in reliance on certain assumptions that it believes
are reasonable at this time, including assumptions as to the ability of the Parties to receive, in a timely manner and on satisfactory
terms, the necessary Court, COFECE, Securityholder, Coeur Stockholder and other third party approvals; the listing of the Coeur Shares
to be issued in connection with the Arrangement on the NYSE; no material adverse change in the market price of silver, gold and other
metal prices; the ability of the Parties to satisfy, in a timely manner, the other conditions to the closing of the Arrangement; the Company’s
and Coeur’s ability to obtain all necessary permits, licenses and regulatory approvals for operations in a timely manner; the adequacy
of the financial resources of the Company and Coeur; sustained labour stability and availability of equipment; the maintaining of positive
relations with local groups; favourable equity and debt capital markets; stability in financial capital markets and other expectations
and assumptions which management believes are appropriate and reasonable. The anticipated dates provided in this Circular regarding the
Arrangement may change for a number of reasons, including the inability to secure the necessary regulatory, Court, Securityholder or other
third-party approvals in the time assumed or the need for additional time to satisfy the other conditions to the completion of the Arrangement.
Accordingly, readers should not place undue reliance on the forward-looking statements and information contained in this Circular.
Since forward-looking statements and information address future events
and conditions, by their very nature they involve inherent risks and uncertainties. Actual results could differ materially from those
currently anticipated due to a number of risks, uncertainties and factors. Such risks, uncertainties and factors include, among others:
the risk that the Arrangement may not close when planned or at all or on the terms and conditions set forth in the Arrangement Agreement;
the failure of the Company and Coeur to obtain the necessary regulatory, Court, Securityholder, Coeur Stockholder, COFECE and other third-party
approvals, or to otherwise satisfy the conditions to the completion of the Arrangement, in a timely manner, or at all; if a third party
makes a Company Superior Proposal, the Arrangement may not be completed and the Company may be required to pay the Company Termination
Payment or the Expense Reimbursement; if the Arrangement is not completed, and the Company continues as an independent entity, there are
risks that the announcement of the Arrangement and the dedication of substantial resources of the Company to the completion of Arrangement
could have an impact on the Company’s current business relationships and could have a material adverse effect on the current and
future operations, financial condition and prospects of the Company; the failure of the Company to comply with the terms of the Arrangement
Agreement may, in certain circumstances, result in the Company being required to pay the Company Termination
| | SILVERCREST METALS INC. | 16 |
| | | 2025 Special Meeting of Securityholders |
Payment to Coeur, the result
of which could have a material adverse effect on the Company’s financial position and results of operations and its ability to fund
growth prospects and current operations; the benefits expected from the Arrangement may not be realized; risks associated with business
integration; risks related to the Parties’ respective properties; risks related to competitive conditions; risks associated with
the Parties’ lack of control over mining conditions; risks related to the operations of the Parties; the risk that actual results
of current exploration activities may be different than forecasts; risks related to reclamation activities; the risk that project parameters
may change as plans continue to be refined; risks related to changes in laws, regulations and government practices; risks associated with
the uncertainty of future prices of silver and other metals and currency exchange rates; the risk that plant, equipment or processes may
fail to operate as anticipated; risks related to accidents and labour disputes and other risks inherent to the mining and mineral exploration
industry; risks associated with delays in obtaining governmental approvals or financing or in the completion of exploration or development
activities; risks related to the inherent uncertainty of mineral resource and mineral reserve estimates; risks associated with uncertainties
inherent to feasibility and other economic studies; health, safety and environmental risks; and the risks discussed under the heading
“Risk Factors” and elsewhere in the Circular, including in the documents incorporated by reference in the Circular.
Securityholders are cautioned that the foregoing list of factors is
not exhaustive. Additional information on other factors that could affect the operations or financial results of the Parties is included
in reports filed by the Company and Coeur with applicable Canadian Securities Authorities (which are available under each of the Company’s
and Coeur’s respective SEDAR+ profile at www.sedarplus.ca) and with the SEC (which are available on EDGAR at www.sec.gov).
The forward-looking statements and information contained in this Circular
are made as of the date hereof and SilverCrest and Coeur undertake no obligation to update publicly or revise any forward-looking statements
or information, whether as a result of new information, future events or otherwise, unless required by applicable Securities Laws and
readers should also carefully consider the matters discussed under the heading “Risk Factors”, “Information
Concerning the Combined Company” and the risks described in the Coeur Annual Report and the Company AIF and other documents
incorporated by reference herein. All forward-looking statements contained in Appendix H and elsewhere in this Circular are expressly
qualified in their entirety by the cautionary statements set forth above and in any document incorporated by reference herein.
Reference to Financial Information and Additional
Information
Financial information provided in the Company’s
comparative annual financial statements and the Company’s management discussion and analysis for the year ended December 31, 2023
are available on SEDAR+ at www.sedarplus.ca and on EDGAR at www.sec.gov. You can obtain additional documents related to
the Company without charge on SEDAR+ at www.sedarplus.ca and on EDGAR at www.sec.gov. You can also obtain documents related to
the Company without charge by visiting the Company’s website at www.silvercrestmetals.com.
| | SILVERCREST METALS INC. | 17 |
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GLOSSARY OF TERMS
In this Circular, the following capitalized words and terms shall
have the following meanings:
| Acquisition Proposal |
|
In respect of a Party, other than the transactions contemplated by the Arrangement Agreement, any offer, proposal or inquiry from any Person or group of Persons (other than the other Party or any controlled affiliate of the other Party), whether written or oral, made after October 3, 2024, relating to: (a) any direct or indirect sale or disposition (or any joint venture, lease, license, long-term supply agreement, royalty agreement or other arrangement having the same economic effect as a sale or disposition), in a single transaction or series of related transactions, of (i) assets of such Party and or one or more of its Subsidiaries (including shares of Subsidiaries of such Party) that, individually or in the aggregate, (A) represent 20% or more of the consolidated assets of such Party and its Subsidiaries, taken as a whole and measured by the fair market value thereof, or (B) contribute 20% or more of the consolidated revenue of such Party and its Subsidiaries, taken as a whole, or (ii) 20% or more of any class of voting or equity securities (and/or securities convertible into, or exchangeable or exercisable for such voting or equity securities) of such Party or 20% or more of any class of voting or equity securities (and/or securities convertible into, or exchangeable or exercisable for such voting or equity securities) of one or more Subsidiaries of such Party whose assets, individually or in the aggregate, constitute 20% or more of the consolidated assets of such Party and its Subsidiaries, taken as a whole (in each case, determined based upon the most recent publicly available consolidated financial statements of such Party); (b) any direct or indirect take-over bid, tender offer, exchange offer, treasury issuance or other transaction that, if consummated, would result in such Person or group of Persons beneficially owning 20% or more of any class of voting or equity securities (and/or securities convertible into, or exchangeable or exercisable for such voting or equity securities) of such Party or 20% or more of any class of voting or equity securities (and/or securities convertible into, or exchangeable or exercisable for such voting or equity securities) of one or more Subsidiaries of such Party whose assets, individually or in the aggregate, constitute 20% or more of the consolidated assets of such Party and its Subsidiaries, taken as a whole (determined based upon the most recent publicly available consolidated financial statements of such Party); or (c) a plan of arrangement, merger, amalgamation, consolidation, share exchange, share reclassification, business combination, reorganization, recapitalization, liquidation, dissolution, winding up or other similar transaction involving such Party and/or any of its Subsidiaries that, if consummated, would result in such Person or group of Persons beneficially owning 20% or more of any class of voting or equity securities (and/or securities convertible into, or exchangeable or exercisable for such voting or equity securities) of such Party or 20% or more of any class of voting or equity securities (and/or securities convertible into, or exchangeable or exercisable for such voting or equity securities) of one or more Subsidiaries of such Party whose assets, individually or in the aggregate, constitute 20% or more of the consolidated assets of such Party and its Subsidiaries, taken as a whole (determined based upon the most recent publicly available consolidated financial statements of such Party). |
| |
|
|
| affiliate |
|
Has the meaning ascribed thereto in NI 45-106 in force as of the date of the Arrangement Agreement, unless otherwise indicated. |
| |
|
|
| allowable capital loss |
|
See “Certain Canadian Federal Income Tax Considerations – Holders Resident in Canada – Taxation of Capital Gains and Capital Losses”. |
| |
|
|
| Amalco |
|
See “Certain Canadian Federal Income Tax Considerations – Holders Resident in Canada – Dissenting Resident Holders”. |
| |
|
|
| Amalgamation |
|
See “Certain Canadian Federal Income Tax Considerations – Holders Resident in Canada – Dissenting Resident Holders”. |
| |
|
|
| Applicable Federal Rate |
|
The interest rate provided for under Section 1274(d) of the Code. |
| | SILVERCREST METALS INC. | 18 |
| | | 2025 Special Meeting of Securityholders |
| Arrangement |
|
The arrangement of the Company under the provisions of Part 9, Division 5 of the BCBCA on the terms and subject to the conditions set out in the Plan of Arrangement, subject to any amendments or variations thereto made in accordance with the terms of the Arrangement Agreement or the Plan of Arrangement or made at the direction of the Court in the Final Order (with the prior written consent of both SilverCrest and Coeur, each acting reasonably). |
| |
|
|
| Arrangement Agreement |
|
The arrangement agreement
dated October 3, 2024 among Coeur, SilverCrest, Coeur Canadian Sub, Coeur U.S. Sub and Company Mexican Sub, including the schedules
attached thereto, the Coeur Disclosure Letter and the Company Disclosure Letter, as the same may be amended, supplemented or
otherwise modified from time to time in accordance with the terms thereof. |
| |
|
|
| Arrangement Resolution |
|
The special resolution to be considered, and, if thought fit, passed by the Securityholders at the Meeting to approve the Arrangement, substantially in the form and content of Appendix A to this Circular. |
| |
|
|
| Authorization |
|
In respect to any Person, any authorization, order, permit, approval, grant, agreement, licence, classification, restriction, registration, consent, order, right, notification, condition, franchise, privilege, certificate, judgment, writ, injunction, award, determination, direction or decision having the force of Law, of, from or required by any Governmental Entity having jurisdiction over such Person. |
| |
|
|
| BCBCA |
|
Business Corporations Act (British Columbia) and the regulations made thereunder, as promulgated or amended from time to time. |
| |
|
|
| Beneficial Shareholder |
|
A person who holds SilverCrest Shares through an Intermediary or who otherwise does not hold SilverCrest Shares in the Person’s name. |
| |
|
|
| Board |
|
The board of directors of the Company, as constituted from time to time. |
| |
|
|
| Board Recommendation |
|
The unanimous recommendation of the Board that the Securityholders vote FOR the Arrangement Resolution. |
| |
|
|
| Broadridge |
|
Broadridge Financial Solutions, Inc. |
| |
|
|
| Bullion |
|
All gold bullion and silver bullion, whether finished goods produced by or on behalf of the Company and its affiliates or acquired from third parties. |
| |
|
|
| business day |
|
Any day, other than a Saturday, a Sunday or a statutory or civic holiday in New York, New York, Mexico City, Mexico or Vancouver, British Columbia. |
| |
|
|
| Canadian Securities Authorities |
|
British Columbia Securities Commission and any other applicable securities commissions and securities regulatory authority of a province or territory of Canada. |
| |
|
|
| Canadian Securities Laws |
|
Securities Act and any other applicable Canadian provincial or territorial securities Laws (including published policies thereunder). |
| |
|
|
| Capital Gains Tax Proposals |
|
See “Certain Canadian Federal Income Tax Considerations – Holders Resident in Canada – Taxation of Capital Gains and Capital Losses”. |
| |
|
|
| Cassels |
|
Cassels Brock & Blackwell LLP, Canadian counsel to SilverCrest. |
| |
|
|
| CCPC |
|
See “Certain Canadian Federal Income Tax Considerations – Holders Resident in Canada – Additional Refundable Tax”. |
| | SILVERCREST METALS INC. | 19 |
| | | 2025 Special Meeting of Securityholders |
| Chair |
|
The Person responsible for overseeing and facilitating the Meeting. |
| |
|
|
| Change in Recommendation |
|
A Company Change in Recommendation or a Coeur Change in Recommendation, as the context requires. |
| |
|
|
| CIM |
|
The Canadian Institute of Mining, Metallurgy and Petroleum. |
| |
|
|
| CIM Definition Standards |
|
CIM Definition Standards on Mineral Resources and Mineral Reserves, adopted by the CIM Council, as amended. |
| |
|
|
| Circular |
|
This management information circular, including the Notice of Meeting and all appendices hereto and all documents incorporated by reference herein, and all amendments or supplements hereof. |
| |
|
|
| Code |
|
United States Internal Revenue Code of 1986, as amended and the rules and regulations promulgated thereunder. |
| |
|
|
| Coeur |
|
Coeur Mining, Inc., a company existing under the DGCL. |
| |
|
|
| Coeur Annual Financial Statements |
|
“Financial Statements and Supplementary Data” in the Coeur Annual Report. |
| |
|
|
| Coeur Annual Report |
|
Form 10-K annual report of Coeur filed February 19, 2024 for the fiscal year ended December 31, 2023. |
| |
|
|
| Coeur Board |
|
The board of directors of Coeur, as constituted from time to time. |
| |
|
|
| Coeur Board Recommendation |
|
The unanimous recommendation of the Coeur Board that the Coeur Stockholders vote in favour of the Coeur Charter Amendment and Coeur Stock Issuance. |
| |
|
|
| Coeur Canadian Sub |
|
1504648 B.C. Unlimited Liability Company, an unlimited liability corporation existing under the BCBCA, which is a wholly-owned subsidiary of Coeur. |
| |
|
|
| Coeur Change in Recommendation |
|
Any of the following acts,
if done by Coeur or its subsidiaries: (a) adopting, approving, publicly endorsing or publicly recommending or publicly proposing
to adopt, approve, endorse or recommend, any Acquisition Proposal, (b) withdrawing, changing, amending, modifying or qualifying,
or otherwise publicly proposing to withdraw, change, amend, modify or qualify, in a manner adverse to the Company, the Coeur Board
Recommendation, (c) if an Acquisition Proposal has been publicly disclosed, failing to publicly recommend against any such Acquisition
Proposal within ten (10) business days after the Company’s written request that Coeur or the Coeur Board do so (or subsequently
withdraw, change, amend, modify or qualify (or publicly propose to do so), in a manner adverse to Company, such rejection of such
Acquisition Proposal) and reaffirming the Coeur Board Recommendation within such ten (10) business day period (or, with respect to
any Acquisition Proposals or material amendments, revisions or changes to the terms of any such previously publicly disclosed Acquisition
Proposal that are publicly disclosed within the last ten (10) days prior to the then-scheduled Coeur Meeting, fail to take the actions
referred to in this definition, with references to the applicable ten (10) business day period being replaced with three (3) business
days), (d) failing to include the Coeur Board Recommendation in the Coeur Proxy Statement, (e) approving or authorizing, or causing
or permit Coeur or any Coeur subsidiary to enter into, any merger agreement, acquisition agreement, reorganization agreement, letter of intent, memorandum of understanding, agreement in principle, option agreement, joint venture agreement, partnership agreement or similar agreement or document relating to, or any other agreement or commitment providing for, any Acquisition Proposal (other than an acceptable confidentiality agreement entered into in |
| | SILVERCREST METALS INC. | 20 |
| | | 2025 Special Meeting of Securityholders |
|
|
accordance with Section 8.3(d) of the Arrangement Agreement) or (f) committing to or agreeing to do any of the foregoing. |
| |
|
|
| Coeur Charter Amendment |
|
Amendment to the certificate of incorporation of Coeur to effect an increase to the number of authorized Coeur Shares to 900,000,000 Coeur Shares. |
| |
|
|
| Coeur Disclosure Letter |
|
The disclosure letter dated October 3, 2024 (including all schedules, exhibits and appendices thereto) and executed by Coeur and delivered to SilverCrest concurrently with the execution of the Arrangement Agreement. |
| |
|
|
| Coeur Incentive Awards |
|
All outstanding restricted share units, performance share units, options and any other awards made in accordance with the Coeur Incentive Plan. |
| |
|
|
| Coeur Incentive Plan |
|
Collectively, the Amended & Restated Coeur Mining, Inc. 2018 Long-Term Incentive Plan effective as of May 11, 2021 and applicable form of award agreements thereunder. |
| |
|
|
| Coeur Initial Proposal |
|
See “The Arrangement – Background to the Arrangement”. |
| |
|
|
| Coeur Interim Financial Statements |
|
“Financial Statements” in the Coeur Quarterly Report. |
| |
|
|
| Coeur LOI |
|
See “The Arrangement – Background to the Arrangement”. |
| |
|
|
| Coeur Material Adverse Effect |
|
Any one or more changes,
effects, events, occurrences or states of fact or circumstance, either individually or in the aggregate, that is, or would reasonably
be expected to be, material and adverse to the business, results of operations or condition (financial or otherwise) of Coeur and
its Subsidiaries, taken as a whole, except for any such change, effect, event, occurrence or state of facts or circumstance resulting
or arising from or relating to: (a) the announcement or execution of the Arrangement Agreement or the implementation of the
transactions contemplated thereby (including the impact of any of the foregoing on the relationships, contractual or otherwise, of
Coeur with customers, suppliers, service providers and employees); (b) any change in the market price or trading volume of any
securities of Coeur (it being understood that the changes, effects, events, occurrences or states of fact or circumstance underlying
such change in market price or trading volume that are not otherwise excluded from the definition of a Coeur Material Adverse Effect
may be taken into account in determining whether a Coeur Material Adverse Effect has occurred); (c) any change affecting the gold
and silver mining industry as a whole; (d) any change (on a current or forward basis) in the price of gold or silver or any
changes in commodity prices or general market prices affecting the mining industry; (e) general political, economic, financial,
currency exchange, inflation, interest rates, securities or commodity market conditions in the United States, Canada or Mexico; (f) any
change or prospective change after October 3, 2024 in GAAP or changes or prospective changes in applicable law or regulatory accounting
requirements; (g) the commencement, continuation or escalation of any war, armed hostilities or acts of terrorism, or the occurrence
of any cyber-attacks or data breaches; (h) any general outbreak of illness, pandemic (including COVID-19 or derivatives or variants
thereof), epidemic, national health emergency, forced quarantine, lockdown or similar event, or the worsening thereof; (i) the
failure of Coeur to meet any internal or published projections, forecasts, guidance, budgets, or estimates of revenues, earnings,
cash flow or other financial performance or results of operations for any period (provided, however, that the changes, effects, events,
occurrences or states of fact or circumstance underlying such failure that are not otherwise excluded from the definition of a Coeur
Material Adverse Effect may be considered to determine whether such failure constitutes a Coeur Material Adverse Effect); (j) any natural disaster (including any hurricane, flood, tornado, earthquake, forest fire, weather-related event or man-made natural disaster); or (k) any adoption, implementation, promulgation, repeal, modification, amendment, reinterpretation, change or proposal of any applicable Law of and by any Governmental Entity occurring after October 3, 2024 (including with respect to Taxes); provided, however, that with |
| | SILVERCREST METALS INC. | 21 |
| | | 2025 Special Meeting of Securityholders |
|
|
respect to clauses (c), (d), (e), (f), (g), (h) and (j), to the extent any such change, effect, event, occurrence or state of facts or circumstance has a disproportionate effect on Coeur and its Subsidiaries, taken as a whole, compared to other entities operating in the industries in which Coeur and its Subsidiaries operate (in which case the incremental disproportionate effect may be taken into account in determining whether there has been a Coeur Material Adverse Effect, and only to the extent otherwise permitted by this definition). |
| |
|
|
| Coeur Material Contract |
|
Any Contract: (a) that, if terminated or modified or if it ceased to be in effect, would
reasonably be expected to have a Coeur Material Adverse Effect; (b) under which Coeur or any of is Subsidiaries has directly or indirectly
guaranteed any liabilities or obligations of a third party (other than endorsements for collection in the ordinary course) in excess of
$9 million in the aggregate; (c) relating to indebtedness for borrowed money of Coeur or any of is Subsidiaries or any guarantee
by Coeur or any of its Subsidiaries of any other Person’s indebtedness for borrowed money, with an outstanding principal amount
in excess of $15 million; (d) that is a material partnership, limited liability company agreement, shareholder agreement, joint
venture, alliance agreement or other similar agreement or arrangement in respect of any Person that is not a wholly-owned Subsidiary of
Coeur (other than any such agreement or arrangement relating to the operation or business of a Coeur Property in the ordinary course and
which is not material with respect to such Coeur Property); (e) under which Coeur or any of its Subsidiaries is obligated to make
or expects to receive payments on an annual basis in excess of $9 million in the aggregate; (f) that limits or restricts Coeur
or any of Coeur Material Subsidiaries from engaging in any line of business or any geographic area in any material respect; (g) that
contains any right on the part of any third party to acquire Mineral Rights or other property rights from Coeur or any of its Subsidiaries
that are material to Coeur and its subsidiaries, taken as a whole, or that form any part of Coeur Mineral Interests which are material
to Coeur and its Subsidiaries, taken as a whole; (h) that contains any rights on the part of Coeur or any of its Subsidiaries to acquire
Mineral Rights or other property rights from any third party that, if acquired, would be material to Coeur and its Subsidiaries, taken
as a whole; (i) that is a contractual royalty, production payment, net profits, earn-out, streaming agreement, metal pre-payment
or similar agreement that has a value in excess of $15 million; (j) that is an agreement with a Governmental Entity, or an agreement
with any Indigenous group, or other organizations with authority to represent such groups, in each case, that is material to Coeur and
its Subsidiaries, taken as a whole; (k) that is a registration rights agreement; (l) an earn-in, back-in, right of first refusal
or right first offer in respect of Coeur Mineral Interests; and (o) that is material to Coeur and its Subsidiaries, taken as a whole,
and related to the operation of, or the exploitation, extraction or production of metals from, Coeur Mineral Interests; and for greater
certainty, includes Coeur Material Contracts listed in the Coeur Disclosure Letter. |
| |
|
|
| Coeur Material Subsidiaries |
|
The Subsidiaries of Coeur
set out in the Coeur Disclosure Letter. |
| |
|
|
| Coeur Meeting |
|
The meeting of the Coeur Stockholders, including any adjournment or postponement thereof, to be called and held in accordance with applicable Law to consider Coeur Charter Amendment, Coeur Stock Issuance and for any other purpose as may be set out in the Coeur Proxy Statement. |
| |
|
|
| Coeur Mineral Interests |
|
Collectively, all material
real property owned by Coeur and its Subsidiaries, all material real property leased, subleased, licensed and/or otherwise used or
occupied (whether as tenant, subtenant, licensee or pursuant to any other occupancy arrangement) by Coeur and its Subsidiaries, in connection with the operation of the business of Coeur and its Subsidiaries as it is now being conducted and all Mineral Rights, concessions, leases or claims of Coeur that are material to operation to their business as currently conducted. |
| |
|
|
| Coeur Projections |
|
See “Risk Factors – Risks Relating to the Arrangement”. |
| | SILVERCREST METALS INC. | 22 |
| | | 2025 Special Meeting of Securityholders |
| Coeur Properties |
|
(a) All material real property owned by Coeur and its Subsidiaries; and (b) all material real property leased, subleased, licensed and/or otherwise used or occupied (whether as tenant, subtenant, licensee or pursuant to any other occupancy arrangement) by Coeur or its Subsidiaries, in each case, in connection with the operation of the business of Coeur and its Subsidiaries as it is now being conducted. |
| |
|
|
| Coeur Proxy Statement |
|
The proxy statement on Schedule 14A to be distributed to the Coeur Stockholders, including all schedules, appendices and exhibits thereto and enclosures therewith, and information incorporated by reference therein, in connection with the Coeur Meeting, as amended, supplemented or otherwise modified from time to time in accordance with the Arrangement Agreement. |
| |
|
|
| Coeur Quarterly Report |
|
Form 10-Q quarterly report of Coeur filed November 6, 2024 for the nine months ended September 30, 2024. |
| |
|
|
| Coeur Shares |
|
Shares of common stock, par value $0.01 per share, of Coeur. |
| |
|
|
| Coeur Stock Issuance |
|
The issuance of the Coeur Shares as Consideration under the Plan of Arrangement. |
| |
|
|
| Coeur Stockholder Approvals |
|
The approval of the (i) Coeur Stock Issuance by the affirmative vote of at least a majority of the votes cast in person or represented by proxy at the Coeur Meeting in accordance with Section 312.03(c) and Section 312.07 of the NYSE Listed Company Manual, and (ii) Coeur Charter Amendment by the affirmative vote of Coeur Stockholders required by the certificate of incorporation of Coeur and the DGCL at the Coeur Meeting. |
| |
|
|
| Coeur Stockholders |
|
Holders of Coeur Shares. |
| |
|
|
| Coeur Superior Proposal |
|
A bona fide unsolicited written Acquisition Proposal (with references to 20% being deemed to be replaced with references to 50%) in respect of Coeur and its Subsidiaries that did not result from a breach of Section 8.1 of the Arrangement Agreement: (a) that is reasonably capable of being completed without undue delay, taking into account all legal, financial, regulatory and other aspects of such Acquisition Proposal and the Person or group of Persons making such Acquisition Proposal; (b) that is not subject to any financing condition and in respect of which adequate arrangements have been made to complete any required financing to consummate such Acquisition Proposal to the satisfaction of the Coeur Board, acting in good faith (after consultation with Coeur’s legal and financial advisors); (c) that is not, as of the date that Coeur provides a Coeur Superior Proposal Notice, subject to a due diligence and/or access condition (but, for greater certainty, may include a customary access covenant); (d) complies with applicable Canadian Securities Laws in all material respects; and (e) in respect of which the Coeur Board (after consultation with Coeur’s legal and financial advisors) determines in good faith, and after taking into account all the terms and conditions of such Acquisition Proposal, including all legal, financial, regulatory and other aspects of such Acquisition Proposal, would, if consummated in accordance with its terms, result in a transaction that is more favourable, from a financial point of view, to the Coeur Stockholders, than the Arrangement (including any amendments to the terms and conditions of the Arrangement Agreement and the Plan of Arrangement proposed by the Company pursuant to Section 8.4(b) of the Arrangement Agreement). |
| |
|
|
| Coeur Termination Payment |
|
$100,000,000. |
| |
|
|
| Coeur Termination Payment Event |
|
See “The Arrangement Agreement – Termination of the Arrangement Agreement – Termination Payments”. |
| | SILVERCREST METALS INC. | 23 |
| | | 2025 Special Meeting of Securityholders |
| Coeur U.S. Sub |
|
Coeur Rochester, Inc., a company existing under the DGCL, which is a wholly-owned subsidiary of Coeur. |
| |
|
|
| Coeur Voting Agreements |
|
The voting and support agreements between SilverCrest and the Coeur Stockholders party thereto setting forth the terms and conditions upon which they have agreed, among other things, to vote their Coeur Shares in favour of the Coeur Charter Amendment and Coeur Stock Issuance. |
| |
|
|
| COFECE |
|
Federal Competition Commission of Mexico (Comisión Federal de Competencia Económica), or the body or department that replaces it. |
| |
|
|
| COFECE Approval |
|
The unconditional approval of the concentration consisting in the transactions contemplated in the Arrangement Agreement issued by COFECE, pursuant to the provisions set forth in the Mexican Antitrust Law (Ley -Federal de Competencia Económica). |
| |
|
|
| Combined Company |
|
Coeur following completion of the Arrangement. |
| |
|
|
| Company or SilverCrest |
|
SilverCrest Metals Inc., a company existing under the BCBCA. |
| |
|
|
| Company AIF |
|
Annual information form of SilverCrest dated March 11, 2024 for the year ended December 31, 2023. |
| |
|
|
| Company Annual Financial Statements |
|
Audited consolidated financial statements of the Company as at and for the fiscal year ended December 31, 2023, including the notes thereto. |
| |
|
|
| Company Annual MD&A |
|
Management’s discussion and analysis of SilverCrest for the fiscal year ended December 31, 2023. |
| |
|
|
| Company Budget |
|
Forecasted 2024 and 2025 capital and operating budget of the Company and its Subsidiaries, as set forth in the Company Disclosure Letter. |
| |
|
|
| Company Canadian Sub |
|
NorCrest Metals Inc., a corporation existing under the laws of the Province of British Columbia, Canada, that is a direct wholly owned subsidiary of the Company. |
| |
|
|
| Company Canadian Sub Shares |
|
The common shares in the authorized share structure of Company Canadian Sub. |
| |
|
|
| Company Change in Recommendation |
|
Any of the following acts,
if done by the Company or its subsidiaries: (a) adopting, approving, publicly endorsing or publicly recommending or publicly proposing
to adopt, approve, endorse or recommend, any Acquisition Proposal, (b) withdrawing, changing, amending, modifying or qualifying,
or otherwise publicly proposing to withdraw, change, amend, modify or qualify, in a manner adverse to Coeur, the Board Recommendation,
(c) if an Acquisition Proposal has been publicly disclosed, failing to publicly recommend against any such Acquisition Proposal within
ten (10) business days after Coeur’s written request that the Company or the Board do so (or subsequently withdraw, change,
amend, modify or qualify (or publicly propose to do so), in a manner adverse to Coeur, such rejection of such Acquisition Proposal)
and reaffirming the Board Recommendation within such ten (10) business day period (or, with respect to any Acquisition Proposals
or material amendments, revisions or changes to the terms of any such previously publicly disclosed Acquisition Proposal that are publicly disclosed within the last ten (10) days prior to the then-scheduled Meeting, failing to take the actions referred to in this definition, with references to the applicable ten (10) business day period being replaced with three (3) business days), (d) failing to include the Board Recommendation in the Circular, (e) approving or authorizing, or causing or permitting the Company or any Company subsidiary to enter into, any merger agreement, acquisition agreement, reorganization agreement, letter of intent, memorandum of understanding, agreement in principle, option agreement, joint venture agreement, partnership agreement or similar agreement or document relating to, or any other agreement or commitment providing for, any Acquisition Proposal (other than an acceptable |
| | SILVERCREST METALS INC. | 24 |
| | | 2025 Special Meeting of Securityholders |
|
|
confidentiality agreement entered into in accordance with Section 7.3(d) of the Arrangement Agreement) or (f) committing to or agreeing to do any of the foregoing. |
| |
|
|
| Company Credit Agreement |
|
The credit agreement dated November 29, 2022 between, amongst others, the Company as borrower, The Bank of Nova Scotia as administrative agent, The Bank of Nova Scotia and Bank of Montreal as joint lead arrangers and joint bookrunners, Bank of Montreal as the syndication agent and the lenders thereto from time to time. |
| |
|
|
| Company Director Nominees |
|
Messrs. N. Eric Fier and Pierre Beaudoin. |
| |
|
|
| Company Disclosure Letter |
|
The disclosure letter dated October 3, 2024 (including all schedules, exhibits and appendices thereto) and executed by the Company and delivered to Coeur concurrently with the execution of the Arrangement Agreement. |
| |
|
|
| Company DSU Plan |
|
Deferred share unit plan of the Company effective December 19, 2019. |
| |
|
|
| Company Equity Incentive Plans |
|
Collectively, the Company Share Unit Plan, the Company Option Plans and the Company DSU Plan. |
| |
|
|
| Company Financial Statements |
|
Collectively, the Company Annual Financial Statements and Company Interim Financial Statements. |
| |
|
|
| Company Incentive Awards |
|
Collectively, the SilverCrest DSUs, SilverCrest RSUs, SilverCrest Options and SilverCrest PSUs. |
| |
|
|
| Company Interim Financial Statements |
|
Interim consolidated financial statements of the Company as at and for the three and nine months ended September 30, 2024, including the notes thereto. |
| |
|
|
| Company Loan |
|
See “Summary – The Arrangement”. |
| |
|
|
| Company Material Adverse Effect |
|
Any one or more changes,
effects, events, occurrences or states of fact or circumstance, either individually or in the aggregate, that is, or would reasonably
be expected to be, material and adverse to the business, results of operations or condition (financial or otherwise) of the Company
and its Subsidiaries, taken as a whole, except for any such change, effect, event, occurrence or state of facts or circumstance resulting
or arising from or relating to: (a) the announcement or execution of this Agreement or the implementation of the transactions contemplated
hereby (including the impact of any of the foregoing on the relationships, contractual or otherwise, of the Company with customers,
suppliers, service providers and employees); (b) any change in the market price or trading volume of any securities of the Company
(it being understood that the changes, effects, events, occurrences or states of fact or circumstance underlying such change in market
price or trading volume that are not otherwise excluded from the definition of a Company Material Adverse Effect may be taken into
account in determining whether a Company Material Adverse Effect has occurred); (c) any change affecting the gold and silver mining
industry as a whole; (d) any change (on a current or forward basis) in the price of gold or silver or any changes in commodity prices
or general market prices affecting the mining industry; (e) general political, economic, financial, currency exchange, inflation, interest rates, securities or commodity market conditions in the United States, Canada or Mexico; (f) any change or prospective change after the date hereof in IFRS or changes or prospective changes in applicable Law or regulatory accounting requirements; (g) the commencement, continuation or escalation of any war, armed hostilities or acts of terrorism, or the occurrence of any cyber-attacks or data breaches; (h) any general outbreak of illness, pandemic (including COVID-19 or derivatives or variants thereof), epidemic, national health emergency, forced quarantine, lockdown or similar event, or the worsening thereof; (i) the failure of the Company to meet any internal or published projections, forecasts, guidance, budgets, or estimates of revenues, earnings, cash flow or other |
| | SILVERCREST METALS INC. | 25 |
| | | 2025 Special Meeting of Securityholders |
| |
|
financial performance or results of operations for any period (provided, however, that the changes, effects, events, occurrences or states of fact or circumstance underlying such failure that are not otherwise excluded from the definition of a Company Material Adverse Effect may be considered to determine whether such failure constitutes a Company Material Adverse Effect); (j) any natural disaster (including any hurricane, flood, tornado, earthquake, forest fire, weather-related event or man-made natural disaster); or (k) any adoption, implementation, promulgation, repeal, modification, amendment, reinterpretation, change or proposal of any applicable Law of and by any Governmental Entity occurring after the date hereof (including with respect to Taxes); provided, however, that with respect to clauses (c), (d), (e), (f), (g), (h), (j) and (k), to the extent any such change, effect, event, occurrence or state of facts or circumstance has a disproportionate effect on the Company and its Subsidiaries, taken as a whole, compared to other entities operating in the industries in which the Company and its Subsidiaries, taken as a whole, operate (in which case the incremental disproportionate effect may be taken into account in determining whether there has been a Company Material Adverse Effect, and only to the extent otherwise permitted by this definition). |
| |
|
|
| Company Material Contract |
|
Any Contract: (a) that,
if terminated or modified or if it ceased to be in effect, would reasonably be expected to have a Company Material Adverse Effect;
(b) under which the Company or any of its Subsidiaries has directly or indirectly guaranteed any liabilities or obligations
of a third party (other than endorsements for collection in the ordinary course) in excess of $3 million in the aggregate; (c)
relating to indebtedness for borrowed money of the Company or any of its Subsidiaries or any guarantee by the Company or any of its
Subsidiaries of any other Person’s indebtedness for borrowed money, with an outstanding principal amount in excess of $5 million;
(d) that is a material partnership, limited liability company agreement, shareholder agreement, joint venture, alliance agreement
or other similar agreement or arrangement in respect of any Person that is not a wholly-owned Subsidiary of the Company (other than
any such agreement or arrangement relating to the operation or business of a Company Property in the ordinary course and which is
not material with respect to such Company Property); (e) under which the Company or any of its Subsidiaries is obligated to make
payments to, or expects to receive payments from, a third party on an annual basis in excess of $5 million in the aggregate;
(f) that limits or restricts the Company or any of its Subsidiaries from engaging in any line of business or any geographic area
in any material respect; (g) that contains any right on the part of any third party to acquire Mineral Rights or other property rights
from the Company or any of its Subsidiaries that are material to the Company and its Subsidiaries, taken as a whole, or that form
any part of the Company Mineral Interests which are material to the Company and its Subsidiaries, taken as a whole; (h) that
contains any rights on the part of the Company or any of its Subsidiaries to acquire Mineral Rights or other property rights from
any third party that, if acquired, would be material to the Company and its Subsidiaries, taken as a whole; (i) that is a contractual
royalty, production payment, net profits, earn-out, streaming agreement, metal pre-payment or similar agreement that has a value
in excess of $3 million; (j) that is an agreement with a Governmental Entity, or an agreement with any Indigenous group, or
other organizations with authority to represent such groups, in each case, that is material to the Company and its Subsidiaries,
taken as a whole; (k) that is a registration rights agreement; (l) an earn-in, back-in, right of first refusal or right first offer
in respect of the Company Mineral Interests; and (o) that is material to the Company and its Subsidiaries, taken as a whole, and related to the operation of, or the exploitation, extraction or production of metals from, the Company Mineral Interests; and, for greater certainty, includes the Company Material Contracts listed in the Company Disclosure Letter. |
| |
|
|
| Company Mexican Sub |
|
Compañía Minera La Llamarada, S.A. De C.V., an indirect wholly-owned Mexican Subsidiary of the Company. |
| |
|
|
| Company Mineral Interests |
|
Collectively all material real property owned by the Company and its Subsidiaries, all material real property leased, subleased, licensed and/or otherwise used or occupied (whether as tenant, subtenant, licensee or pursuant to any other occupancy arrangement) by the Company or its Subsidiaries, in each case, in connection with the operation of the business of the Company and its Subsidiaries as it is now being conducted and all Mineral Rights, concessions, leases or claims of the Company and its |
| | SILVERCREST METALS INC. | 26 |
| | | 2025 Special Meeting of Securityholders |
| |
|
Subsidiaries
that are material to operation to their business as currently conducted. |
| |
|
|
| Company Option Plans |
|
Collectively, the Legacy Company Option Plan and the New Company Option Plan. |
| |
|
|
| Company Property |
|
(a) All material real property owned by the Company and its Subsidiaries; and (b) all material real property leased, subleased, licensed and/or otherwise used or occupied (whether as tenant, subtenant, licensee or pursuant to any other occupancy arrangement) by the Company or its Subsidiaries, in each case, in connection with the operation of the business of the Company and its Subsidiaries as it is now being conducted. |
| |
|
|
| Company PSUs |
|
The outstanding performance share units granted under the Company Share Unit Plan. |
| |
|
|
| Company Share Unit Plan |
|
Equity share unit plan of the Company effective June 3, 2021. |
| |
|
|
| Company Standstill Agreement |
|
A Contract entered into by the Company and/or any of its Subsidiaries that currently, or after the Effective Time, other than a confidentiality and standstill agreement permitted by Section 7.3 of the Arrangement Agreement, restricts the ability of the Company or any of its Subsidiaries to offer to purchase the assets or equity securities of another Person. |
| |
|
|
| Company Superior Proposal |
|
A bona fide unsolicited written Acquisition Proposal (with references to 20% being deemed to be replaced with references to 50%) in respect of the Company and its Subsidiaries that did not result from a breach of Section 7.1 of the Arrangement Agreement: (a) that is reasonably capable of being completed without undue delay, taking into account all legal, financial, regulatory and other aspects of such Acquisition Proposal and the Person or group of Persons making such Acquisition Proposal; (b) that is not subject to any financing condition and in respect of which adequate arrangements have been made to complete any required financing to consummate such Acquisition Proposal to the satisfaction of the Board, acting in good faith (after consultation with the Company’s legal and financial advisors); (c) that is not, as of the date that the Company provides a Superior Proposal Notice, subject to a due diligence and/or access condition (but, for greater certainty, may include a customary access covenant); (d) complies with applicable Canadian Securities Laws in all material respects; and (e) in respect of which the Board (after consultation with the Company’s legal and financial advisors) determines in good faith, and after taking into account all the terms and conditions of such Acquisition Proposal, including all legal, financial, regulatory and other aspects of such Acquisition Proposal would, if consummated in accordance with its terms, result in a transaction that is more favourable, from a financial point of view, to the Shareholders, than the Arrangement (including any amendments to the terms and conditions of the Arrangement Agreement and the Plan of Arrangement proposed by Coeur pursuant to Section 7.4(b) of the Arrangement Agreement). |
| |
|
|
| Company Technical Report |
|
The technical report prepared for the Company entitled “Las Chispas Operation Technical Report” with an effective date of July 19, 2023 and a report date of September 5, 2023. |
| |
|
|
| Company Termination Payment |
|
$60,000,000. |
| |
|
|
| Company Termination Payment Event |
|
See “The Arrangement Agreement – Termination of the Arrangement Agreement – Termination Payments”. |
| |
|
|
| Confidentiality Agreement |
|
The mutual confidentiality agreement between Coeur and SilverCrest dated April 17, 2024. |
| |
|
|
| Consideration |
|
Consideration to be received by the Shareholders pursuant to the Plan of Arrangement, being 1.6022 Coeur Shares for each SilverCrest Share held, as adjusted for fractional shares. |
| | SILVERCREST METALS INC. | 27 |
| | | 2025 Special Meeting of Securityholders |
| Consideration Shares |
|
Coeur Shares to be issued to Shareholders pursuant to the Plan of Arrangement. |
| |
|
|
| Continuing Employees |
|
See “The Arrangement Agreement – Certain Employee Matters”. |
| |
|
|
| Contract |
|
Any legally binding contract, agreement, license, franchise, lease, arrangement, commitment, understanding, joint venture, partnership or other right or obligation (written or oral) and any amendment thereto to which a Party or any of its Subsidiaries is a party or by which it or any of its Subsidiaries is bound or affected or to which any of their respective properties or assets is subject. |
| |
|
|
| Controlling Individual |
|
See “Certain Canadian Federal Income Tax Considerations – Holders Resident in Canada – Eligibility for Investment by Registered Plans”. |
| |
|
|
| Cormark |
|
Cormark Securities Inc., co-financial advisor to SilverCrest. |
| |
|
|
| Cormark Fairness Opinion |
|
The opinion of Cormark to the effect that, as of the date of such opinion and based upon and subject to the assumptions, limitations and qualifications set forth therein, the Consideration to be received by the Shareholders under the Arrangement is fair, from a financial point of view, to the Shareholders. |
| |
|
|
| Court |
|
Supreme Court of British Columbia. |
| |
|
|
| CRA |
|
Canada Revenue Agency. |
| |
|
|
| De Minimis Exclusion |
|
See “The Arrangement – MI 61-101” |
| |
|
|
| Depositary |
|
Computershare Investor Services Inc. |
| |
|
|
| DGCL |
|
Delaware General Corporation Law, as amended from time to time. |
| |
|
|
| Dissent Rights |
|
Rights of dissent exercisable by Registered Shareholders as of the Record Date in respect of the Arrangement under Division 2 of Part 8 of the BCBCA, as modified by Article 4 of the Plan of Arrangement, the Interim Order and the Final Order. |
| |
|
|
| Dissent Shares |
|
All SilverCrest Shares held by a Dissenting Shareholder and in respect of which the Dissenting Shareholder has validly given a notice of dissent. |
| |
|
|
| Dissenting Non-Resident Holder |
|
See “Certain Canadian Federal Income Tax Considerations – Holders Not Resident in Canada – Dissenting Non-Resident Holders”. |
| |
|
|
| Dissenting Resident Holder |
|
See “Certain Canadian Federal Income Tax Considerations – Holders Resident in Canada – Dissenting Resident Holders”. |
| |
|
|
| Dissenting Shareholder |
|
A Registered Shareholder as at the close of business on the Record Date that duly and validly exercises Dissent Rights, in strict compliance with the dissent procedures set out in Division 2 of Part 8 of the BCBCA, as modified by the Interim Order and Plan of Arrangement, in respect of all SilverCrest Shares held and has not withdrawn or been deemed to have withdrawn such exercise of Dissent Rights. |
| |
|
|
| DRS Advices |
|
Direct registration system advices representing SilverCrest Shares. |
| |
|
|
| EDGAR |
|
Electronic Data Gathering, Analysis, and Retrieval. |
| |
|
|
| Effective Date |
|
The date upon which the Arrangement becomes effective in accordance with Section 2.11(a) of the Arrangement Agreement. |
| | SILVERCREST METALS INC. | 28 |
| | | 2025 Special Meeting of Securityholders |
| Effective Time |
|
9:00 a.m. Toronto time on the Effective Date, or such other time as Coeur and SilverCrest agree to in writing before the Effective Date. |
| |
|
|
| Electing Shareholder |
|
See “Certain United States Federal Income Tax Consequences of the Arrangement – Passive Foreign Income Company Considerations – Consequences of PFIC Status”. |
| |
|
|
| Employment Agreements |
|
See “The Arrangement – Interest of Certain Persons in the Arrangement – Employment Agreements and Compensation Bonus”. |
| |
|
|
| Exchange Ratio |
|
1.6022. |
| |
|
|
| Excluded Benefits |
|
See “The Arrangement Agreement – Certain Employee Matters”. |
| |
|
|
| Excluded Shares |
|
2,064,075 SilverCrest Shares held by Mr. N. Eric Fier. |
| |
|
|
| Exclusivity Period |
|
See “The Arrangement – Background to the Arrangement”. |
| |
|
|
| Expense Reimbursement |
|
Up to $17,000,000. |
| |
|
|
| Extended Exclusivity Period |
|
See “The Arrangement – Background to the Arrangement”. |
| |
|
|
| Fairness Opinions |
|
Collectively, the Cormark Fairness Opinion, Raymond James Fairness Opinion and Scotiabank Fairness Opinion. |
| |
|
|
| Final Order |
|
Final order of the Court contemplated by Section 2.7 of the Arrangement Agreement, in a form and substance acceptable to the Company and Coeur, each acting reasonably, approving the Arrangement, as such order may be amended, supplemented, modified or varied by the Court (with the consent of both the Company and Coeur, each acting reasonably) at any time prior to the Effective Date or, if appealed, then, unless such appeal is withdrawn or denied, as affirmed or as amended (provided that any such amendment is acceptable to both SilverCrest and Coeur, each acting reasonably) on appeal. |
| |
|
|
| GAAP |
|
Generally accepted accounting principles in the United States. |
| |
|
|
| Goodmans |
|
Goodmans LLP, Canadian counsel to Coeur. |
| |
|
|
| Governmental Entity |
|
(a) Any international, federal, provincial, territorial, state, regional, municipal, local or other government, governmental or public department, central bank, court, tribunal, arbitral body, international arbitration institution, commission, board, ministry bureau, agency or entity, domestic or foreign; (b) any stock exchange, including the TSX, the NYSE and the NYSE American; (c) any subdivision, agent, commission, board or authority of any of the foregoing; or (d) any quasi-governmental or private body or self-regulatory organization exercising any regulatory, expropriation or taxing authority under or for the account of any of the foregoing. |
| |
|
|
| GRE |
|
Global Resource Engineering Ltd. |
| |
|
|
| Holder |
|
See “Certain Canadian Federal Income Tax Considerations”. |
| |
|
|
| IAS 34 |
|
International Accounting Standard 34, Interim Financial Reporting |
| |
|
|
| IFRS Accounting Standards |
|
International Financial Reporting Standards as issued by the International Accounting Standards Board. |
| | SILVERCREST METALS INC. | 29 |
| | | 2025 Special Meeting of Securityholders |
| In-The-Money Value |
|
In respect of a stock option at a particular time, the amount, if any, by which (a) the aggregate fair market value at that time of the stock subject to such option exceeds (b) the exercise price of such option. |
| |
|
|
| Independent Committee Exclusion |
|
See “The Arrangement – MI 61-101”. |
| |
|
|
| Initial Outside Date |
|
May 19, 2025. |
| |
|
|
| Interim Order |
|
Interim order of the Court, attached as Appendix C to this Circular, issued following the application therefor submitted to the Court after being informed of the intention to rely upon the exemption from registration under Section 3(a)(10) of the U.S. Securities Act with respect to the Consideration Shares issued pursuant to the Arrangement as contemplated by Section 2.3 of the Arrangement Agreement and the Replacement Options granted pursuant to Section 2.3(g) of the Plan of Arrangement, in a form and substance acceptable to SilverCrest and Coeur, each acting reasonably, providing for, among other things, the calling and holding of the Meeting, as the same may be amended, supplemented, modified or varied by the Court with the consent of SilverCrest and Coeur, each acting reasonably. |
| |
|
|
| Intermediary |
|
Collectively, a broker, investment dealer, bank, trust company, nominee or other intermediary. |
| |
|
|
| IRS |
|
United States Internal Revenue Service. |
| |
|
|
| Las Chispas Operation |
|
The Company’s Las Chispas silver and gold operation located near Hermosillo, Sonora, Mexico. |
| |
|
|
| Laurel Hill |
|
Laurel Hill Advisory Group, the Company’s proxy solicitation agent for the Meeting. |
| |
|
|
| Laws |
|
All laws (including common
law), by-laws, statutes, rules, regulations, principles of law and equity, orders, rulings, ordinances, judgements, injunctions,
determinations, awards, decrees or other requirements, whether domestic or foreign, that are binding upon or applicable to such Person
or its business, and the terms and conditions of any Authorization of or from any Governmental Entity, and, for greater certainty,
includes Securities Laws and applicable common law, and the term “applicable” with respect to such Laws and in
a context that refers to a Party, means such Laws as are applicable to such Party and/or its Subsidiaries or their business, undertaking,
property or securities and emanate from a Person having jurisdiction over the Party
and/or its Subsidiaries or its or their business, undertaking, property or securities. |
| |
|
|
| Legacy Company Option Plan |
|
The legacy stock option plan of the Company effective August 24, 2015, as amended. |
| |
|
|
| Letter of Transmittal |
|
The letter of transmittal sent to the Registered Shareholders for use in connection with the Arrangement. |
| |
|
|
| Liens |
|
Any hypothecs, mortgages, pledges, assignments, liens, charges, security interests, encumbrances and adverse rights or claims or other third party interests or encumbrances of any kind, whether contingent or absolute, and any agreement, option, lease, sublease, restriction, easement, right-of-way, right or privilege (whether by Law, contract or otherwise) capable of becoming any of the foregoing. |
| |
|
|
| LOI Amendment |
|
See “The Arrangement – Background to the Arrangement”. |
| | SILVERCREST METALS INC. | 30 |
| | | 2025 Special Meeting of Securityholders |
| Mark-to-Market Election |
|
See “Certain United States Federal Income Tax Consequences of the Arrangement – U.S. Federal Income Tax Consequences of the Arrangement to U.S. Holders – Passive Foreign Investment Company Considerations”. |
| |
|
|
| Matching Period |
|
See “The Arrangement Agreement – Covenants Regarding Non-Solicitation and Acquisition Proposals – Superior Proposals and Right to Match”. |
| |
|
|
| Maverick |
|
Maverick Mining Consultants Inc. |
| |
|
|
| Maverick Agreement |
|
See “The Arrangement – Interest of Certain Persons in the Arrangement – Employment Agreements and Compensation Bonus – N. Eric Fier (through Maverick)”. |
| |
|
|
| Meeting |
|
The special meeting of the Securityholders, including any adjournment or postponement thereof, to be called and held in accordance with the Interim Order for the purpose of considering and, if thought fit, approving the Arrangement Resolution. |
| |
|
|
| Mexican Antitrust Law |
|
Federal Economic Competition Law (Ley Federal de Competencia Económica) of Mexico. |
| |
|
|
| MI 61-101 |
|
Multilateral Instrument 61-101 – Protection of Minority Security Holders in Special Transactions of the Canadian Securities Administrators. |
| |
|
|
| Mineral Rights |
|
All rights, whether contractual or otherwise, for the exploration for or exploitation of mineral resources and reserves together with surface rights, water rights, royalty interests, fee interests, joint venture interests and other leases, rights of way and enurements related to any such rights. |
| |
|
|
| New Company Option Plan |
|
The stock option plan of the Company effective June 15, 2022, as amended. |
| |
|
|
| NI 43-101 |
|
National Instrument 43-101 – Standards of Disclosure for Mineral Projects of the Canadian Securities Administrators. |
| |
|
|
| NI 45-106 |
|
National Instrument 45-106 – Prospectus Exemptions of the Canadian Securities Administrators. |
| |
|
|
| NI 54-101 |
|
National Instrument 54-101 – Communication with Beneficial Owners of Securities of a Reporting Issuer of the Canadian Securities Administrators. |
| |
|
|
| NOBO |
|
See “Information Concerning The Meeting – Advice to Beneficial (Non-Registered) Shareholders”. |
| |
|
|
| non-GAAP measures |
|
See “Management Information Circular – Non-GAAP Financial Performance Measures”. |
| |
|
|
| Non-Resident Holder |
|
See “Certain Canadian Federal Income Tax Considerations – Holders Not Resident in Canada”. |
| |
|
|
| non-U.S. Holder |
|
A beneficial owner of SilverCrest Shares at the time of the Arrangement and, to the extent applicable, Coeur Shares following the Arrangement that is not a U.S. Holder. |
| |
|
|
| Notice of Dissent |
|
See “Plan of Arrangement – Dissenting Shareholders’ Rights”. |
| |
|
|
| Notice Shares |
|
See “Plan of Arrangement – Dissenting Shareholders’ Rights”. |
| |
|
|
| NYSE |
|
New York Stock Exchange. |
| |
|
|
| NYSE American |
|
NYSE American Stock Exchange. |
| | SILVERCREST METALS INC. | 31 |
| | | 2025 Special Meeting of Securityholders |
| OBO |
|
See “Information Concerning The Meeting – Advice to Beneficial (Non-Registered) Shareholders”. |
| |
|
|
| Optionholders |
|
The holders of SilverCrest Options. |
| |
|
|
| Outside Date |
|
The Initial Outside Date, provided, however, that if (x) the Effective Time has not occurred by such date as a result of the COFECE Approval not having been obtained and (y) all other closing conditions in the Arrangement Agreement have theretofore been satisfied (other than those conditions that by their terms are to be satisfied at the Effective Time, each of which is capable of being satisfied at the Effective Time) or (to the extent permitted by law) waived, the Outside Date will be extended to August 19, 2025. |
| |
|
|
| Parties |
|
Collectively, Coeur, SilverCrest, Coeur Canadian Sub, Coeur U.S. Sub and Company Mexican Sub, and “Party” means any of them, as the context requires. |
| |
|
|
| Party 1 |
|
See “The Arrangement – Background to the Arrangement”. |
| |
|
|
| Party 1 Counterproposal |
|
See “The Arrangement – Background to the Arrangement”. |
| |
|
|
| Party 1 Proposal |
|
See “The Arrangement – Background to the Arrangement”. |
| |
|
|
| Paul, Weiss |
|
Paul, Weiss, Rifkind, Wharton & Garrison LLP, U.S. counsel to SilverCrest. |
| |
|
|
| PCAOB |
|
Public Company Accounting Oversight Board (United States). |
| |
|
|
| Period 1 |
|
See “Certain Canadian Federal Income Tax Considerations – Holders Resident in Canada – Taxation of Capital Gains and Capital Losses”. |
| |
|
|
| Period 2 |
|
See “Certain Canadian Federal Income Tax Considerations – Holders Resident in Canada – Taxation of Capital Gains and Capital Losses”. |
| |
|
|
| Person |
|
An individual, partnership, association, body corporate, trustee, executor, administrator, legal representative, government (including any Governmental Entity) or any other entity, whether or not having legal status. |
| |
|
|
| PFIC |
|
See “Certain United States Federal Income Tax Consequences of the Arrangement – U.S. Federal Income Tax Consequences of the Arrangement to U.S. Holders – Passive Foreign Investment Company Considerations”. |
| |
|
|
| Plan of Arrangement |
|
The plan of arrangement of the Company, substantially in the form of Appendix B to this Circular, and any amendments or variations thereto made in accordance with the Plan of Arrangement or upon the direction of the Court in the Final Order with the consent of SilverCrest and Coeur, each acting reasonably. |
| |
|
|
| Projections |
|
See “Risk Factors – Risks Relating to the Arrangement”. |
| |
|
|
| Proposed Amendments |
|
See “Certain Canadian Federal Income Tax Considerations”. |
| |
|
|
| QEF Election |
|
See “Certain United States Federal Income Tax Consequences of the Arrangement – U.S. Federal Income Tax Consequences of the Arrangement to U.S. Holders – Passive Foreign Investment Company Considerations”. |
| |
|
|
| Raymond James |
|
Raymond James Ltd., co-financial advisor to SilverCrest. |
| | SILVERCREST METALS INC. | 32 |
| | | 2025 Special Meeting of Securityholders |
| Raymond James Fairness Opinion |
|
The opinion of Raymond James to the effect that, as of the date of such opinion and based upon and subject to the assumptions, limitations and qualifications set forth therein, the Consideration to be received by the Shareholders under the Arrangement is fair, from a financial point of view, to the Shareholders. |
| |
|
|
| Record Date |
|
The record date for determining the Securityholders entitled to receive notice of and to vote at the Meeting, being the close of business on December 19, 2024 (Vancouver time) pursuant to the Interim Order. |
| |
|
|
| Registered Plan |
|
See “Certain Canadian Federal Income Tax Considerations – Holders Resident in Canada – Eligibility for Investment by Registered Plans”. |
| |
|
|
| Registered Shareholder |
|
A registered holder of SilverCrest Shares as recorded in the shareholder register of the Company. |
| |
|
|
| Regulations |
|
See “Certain Canadian Federal Income Tax Considerations”. |
| |
|
|
| Replacement Options |
|
Options to acquire Coeur Shares to be issued in exchange for SilverCrest Options pursuant to the Plan of Arrangement. |
| |
|
|
| Representatives |
|
With respect to a Party, such Party’s directors, officers, employees, counsel, financial advisors, accountants, agents, consultants and other authorized representatives and advisors. |
| |
|
|
| Request for Additional Information |
|
See “The Arrangement Agreement – COFECE Approval”. |
| |
|
|
| Request for Basic Information |
|
See “The Arrangement Agreement – COFECE Approval”. |
| |
|
|
| Resident Holder |
|
See “Certain Canadian Federal Income Tax Considerations – Holders Resident in Canada”. |
| |
|
|
| Rule 144 |
|
Rule 144 under the U.S. Securities Act. |
| |
|
|
| Scotiabank |
|
Scotia Capital Inc., independent financial advisor to the Special Committee. |
| |
|
|
| Scotiabank Fairness Opinion |
|
The opinion of Scotiabank to the effect that, as of the date of such opinion and based upon and subject to the assumptions, limitations and qualifications set forth therein, the Consideration to be received by the Shareholders under the Arrangement is fair, from a financial point of view, to the Shareholders. |
| |
|
|
| SEC |
|
United States Securities and Exchange Commission. |
| |
|
|
| Securities Act |
|
Securities Act (British Columbia) and the rules, regulations and published policies made thereunder, as now in effect and as they may be promulgated or amended from time to time. |
| |
|
|
| Securities Laws |
|
Canadian Securities Laws and U.S. Securities Laws. |
| |
|
|
| Securityholders |
|
Collectively, the Shareholders and Optionholders. |
| |
|
|
| SEDAR+ |
|
System for Electronic Document Analysis and Retrieval. |
| |
|
|
| Shareholders |
|
Registered and/or beneficial holders of SilverCrest Shares, as the context requires. |
| | SILVERCREST METALS INC. | 33 |
| | | 2025 Special Meeting of Securityholders |
| SilverCrest DSUs |
|
Outstanding deferred share units granted under the Company DSU Plan and the Company Share Unit Plan. |
| |
|
|
| SilverCrest Options |
|
Outstanding options to purchase SilverCrest Shares granted under the Company Option Plans. |
| |
|
|
| SilverCrest Projections |
|
See “Risk Factors – Risks Relating to the Arrangement”. |
| |
|
|
| SilverCrest PSUs |
|
Outstanding performance share units granted under the Company Share Unit Plan. |
| |
|
|
| SilverCrest RSUs |
|
Outstanding restricted share units granted under the Company Share Unit Plan. |
| |
|
|
| SilverCrest Securityholder |
|
Collectively, the Optionholders and the SilverCrest Shareholders. |
| |
|
|
| SilverCrest Securityholder Approval |
|
The approval of the Arrangement Resolution by at least:
|
| |
|
(i) |
66⅔%
of the votes cast by Shareholders present in person or by proxy at the Meeting; |
| |
|
(ii) |
66⅔%
of the votes cast by the Securityholders present in person or by proxy at the Meeting and voting as a single class; and |
| |
|
(iii) |
a majority of the votes cast by the Shareholders present
in person or represented by proxy at the Meeting, excluding the Excluded Shares for purposes of MI 61-101. |
| |
|
|
| SilverCrest Shareholder |
|
The holders of SilverCrest Shares. |
| |
|
|
| SilverCrest Shares |
|
Common shares in the capital of the Company. |
| |
|
|
| SilverCrest Voting Agreements |
|
Voting and support agreements between Coeur and the Securityholders party thereto setting forth the terms and conditions upon which they have agreed, among other things, to vote their SilverCrest Shares and/or SilverCrest Options in favour of the Arrangement Resolution. |
| |
|
|
| Sinamatella |
|
Sinamatella Solutions Ltd. |
| |
|
|
| Sinamatella Agreement |
|
See “The Arrangement – Interest of Certain Persons in the Arrangement – Employment Agreements and Compensation Bonus – Other Senior Officer”. |
| |
|
|
| SMVR |
|
Sánchez Mejorada Velasco y Ribé, Mexican counsel to SilverCrest. |
| |
|
|
| Special Committee |
|
The special committee of the Board. |
| |
|
|
| Specified Cash Balance |
|
(i) An amount to be specified by Coeur no less than twenty-four (24) hours prior to the Effective Time; or (ii) in case no amount is specified pursuant to clause (i) no less than twenty-four (24) hours prior to the Effective Time, an amount that results in cash in value of no less than $25 million as of the Effective Date remaining with the Company Mexican Sub. |
| |
|
|
| Subpart 1300 |
|
See “Cautionary Note to Securityholders in the United States Concerning Estimates of Measured, Indicated and Inferred Mineral Resources”. |
| |
|
|
| Subsidiary |
|
Has the meaning ascribed thereto in NI 45-106. |
| |
|
|
| Superior Proposal |
|
A Company Superior Proposal or a Coeur Superior Proposal, as the context requires. |
| |
|
|
| Superior Proposal Notice |
|
A notice in writing that the Company must provide Coeur prior to making a Company Change in Recommendation and/or entering into a definitive agreement with respect to a Company Superior Proposal. |
| | SILVERCREST METALS INC. | 34 |
| | | 2025 Special Meeting of Securityholders |
| Tax Act |
|
Income Tax Act (Canada) and the regulations made thereunder, as now in effect and as they may be promulgated or amended from time to time. |
| |
|
|
| taxable capital gain |
|
See “Certain Canadian Federal Income Tax Considerations – Holders Resident in Canada – Taxation of Capital Gains and Capital Losses”. |
| |
|
|
| Taxes |
|
Includes any taxes, duties, fees, premiums, assessments, imposts, levies, expansion fees and other charges of any kind whatsoever imposed by any Governmental Entity, including all interest, penalties, fines, additions to tax or other additional amounts imposed by any Governmental Entity in respect thereof, and including, but not limited to, those levied on, or measured by, or referred to as, income, gross receipts, earnings, profits, mining, mineral, windfall, environmental, royalty, capital, capital stock, transfer, land transfer, disability, ad valorem, sales, net worth, goods and services, harmonized sales, use, value-added, excise, stamp, recording, withholding, business, franchising, property, premium, development, occupation, occupancy, employer health, alternative or add-on minimum, payroll, employment, health, social services, education and social security taxes, all surtaxes, all customs duties and import and export taxes, countervail and anti-dumping, all license, franchise and registration fees and all employment insurance, health insurance and Canada Pension Plan and other pension plan premiums or contributions imposed by any Governmental Entity, any transferee or predecessor liability in respect of any of the foregoing, and any liability for any such amounts imposed with respect to any other person, including under any agreements or arrangements. |
| |
|
|
| Transfer |
|
See “The Arrangement – Voting and Support Agreements – SilverCrest Voting Agreements”. |
| |
|
|
| Transfer Agent |
|
Computershare Investor Services Inc. |
| |
|
|
| Transitional Year |
|
See “Certain Canadian Federal Income Tax Considerations – Holders Resident in Canada – Taxation of Capital Gains and Capital Losses”. |
| |
|
|
| TSX |
|
Toronto Stock Exchange. |
| |
|
|
| United States or U.S. |
|
The United States of America, its territories and possessions, any State of the United States and the District of Columbia. |
| |
|
|
| U.S. Exchange Act |
|
United States Securities Exchange Act of 1934, as amended from time to time and the rules and regulations of the SEC promulgated thereunder. |
| |
|
|
| U.S. Holder |
|
See “Certain United States Federal Income Tax Consequences of the Arrangement”. |
| |
|
|
| U.S. Investment Company Act |
|
United States Investment Company Act of 1940, as amended and the rules and regulations promulgated thereunder. |
| |
|
|
| U.S. Securities Act |
|
United States Securities Act of 1933, as amended and the rules and regulations promulgated thereunder. |
| |
|
|
| U.S. Securities Laws |
|
The U.S. Exchange Act, the U.S. Securities Act and all other applicable U.S. federal securities Laws. |
| |
|
|
| U.S. Securityholders |
|
Securityholders that are in or are a resident of the United States. |
| |
|
|
| U.S. Treasury Regulations |
|
The income tax regulations promulgated under the Code, as such regulations may be amended from time to time. |
| |
|
|
| VIF |
|
Voting instruction form. |
| | SILVERCREST METALS INC. | 35 |
| | | 2025 Special Meeting of Securityholders |
SUMMARY
The following information is a summary of the contents of this Circular.
This summary is provided for convenience only and the information contained in this summary should be read in conjunction with, and is
qualified in its entirety by, the more detailed information and financial data and statements contained, or incorporated by reference,
elsewhere in this Circular. Capitalized terms in this summary have the meaning set out in the “Glossary of Terms” or
as set out herein. The full text of the Arrangement Agreement is available under the Company’s profile on SEDAR+ (www.sedarplus.ca)
and on EDGAR (www.sec.gov).
| Date, Time and Place of Meeting |
The Meeting will be held on February 6, 2025 at 10:00 a.m. (Vancouver time) at the offices of
Cassels Brock & Blackwell LLP at Suite 2200, RBC Place, 885 West Georgia Street, Vancouver, British Columbia. The Meeting can also
be accessed via live webcast at meetnow.global/MHZWLAD. Any Securityholder attending the live webcast will not be able to vote during
the Meeting. Only Securityholders or their duly appointed proxyholders who are present in person at the Meeting are able to vote during
the Meeting. |
| |
|
| Record Date |
The Record Date for determining the Securityholders entitled to receive notice of and to vote at the Meeting is as of the close of business (Vancouver time) on December 19, 2024. |
| |
|
| Purpose of the Meeting |
At the Meeting, Securityholders will be asked to consider and, if deemed acceptable, to pass, with or without variation, the Arrangement Resolution. The approval of the Arrangement Resolution will require the SilverCrest Securityholder Approval. |
| |
|
| The Arrangement |
The purpose of the Arrangement
is to effect the acquisition by Coeur of the Company. If the Arrangement Resolution is approved with the SilverCrest Securityholder
Approval and all other conditions to the closing of the Arrangement are satisfied or waived, the Arrangement will be implemented
by way of a court-approved plan of arrangement under the BCBCA.
At the Effective Time, the
following principal steps, among other steps, shall occur and shall be deemed to occur without any further authorization, act
or formality:
(a)
Transfer of Bullion: All Bullion beneficially owned by the Company shall be, and shall be deemed to be, transferred to
Company Canadian Sub pursuant to Section 85 of the Tax Act and, in consideration therefor, Company Canadian Sub shall (i) allot
and issue one (1) Company Canadian Sub Share to Company, and (ii) issue a U.S. dollar denominated, non-interest bearing, demand
promissory note in favour of the Company with a principal amount equal to the Company’s cost amount of the Bullion (for
the purpose of the Tax Act), and the Company and Company Canadian Sub shall file a joint election under Section 85 of the Tax
Act and applicable provincial tax Laws with an elected amount determined by the Company in its sole discretion. Subsequently,
Company Canadian Sub shall transfer, and shall be deemed to transfer, all Bullion referred to above to Coeur U.S. Sub and, in
consideration therefor, Coeur U.S. Sub shall issue and deliver to Company Canadian Sub a U.S. dollar denominated promissory note,
with a principal amount equal to the purchase price of the Bullion, being the fair market value thereof, bearing interest at
the short-term Applicable Federal Rate for U.S. tax purposes on the Effective Date plus 2% per annum, having a maturity date
that is December 31 of the year following the Effective Date.
(b)
Payment of Intercompany Debt: Company Mexican Sub shall transfer a cash amount: (i) to the Company
equal to the lesser of (A) the principal amount outstanding under the intercompany indebtedness owing by Company Mexican Sub to
the Company (the “Company Loan”) and (B) Company Mexican Sub’s Specified Cash Balance; (ii) if Company
Mexican Sub’s Specified Cash Balance less the repayment described in (i) is positive, to the Company equal to the lesser of
(C) any accrued interest on the Company Loan and (D) Company Mexican Sub’s Specified Cash Balance less the amount of
the
|
| | SILVERCREST METALS INC. | 36 |
| | | 2025 Special Meeting of Securityholders |
|
repayment
described in (i); and (iii) if Company Mexican Sub’s Specified Cash Balance less the repayments described
in (i) and (ii) is positive, to Company Canadian Sub equal to the lesser of (E) the interest owing on
that certain intercompany loan between Company Mexican Sub and Company Canadian Sub and (F) Company Mexican
Sub’s Specified Cash Balance less the amount of the repayments described in (i) and (ii); and following
this step, such amounts determined by this step shall be, and shall be deemed to be, repaid by Company Mexican
Sub.
(c)
Dissenting Shareholders: Each Dissent Share
shall be and shall be deemed to be transferred and assigned by the holder thereof without any further act or formality on its part,
free and clear of all Liens, to the Company in accordance with, and for the Consideration under the Plan of Arrangement, and: (i)
such Dissenting Shareholder shall cease to be, and shall be deemed to cease to be, the registered holder of each such Dissent Share
and the Company shall be the holder of all of the outstanding Dissent Shares, free and clear of all Liens.
(d)
Issuance of SilverCrest Shares to Coeur Canadian
Sub: Each Shareholder, other than a Dissenting Shareholder, shall transfer and assign their SilverCrest Shares, free and clear
of any Liens, to Coeur Canadian Sub in exchange for the Consideration for each such SilverCrest Share so transferred, and in respect
of the SilverCrest Shares so transferred, the registered holder thereof shall cease to be, and shall be deemed to cease to be, the
registered holder of each such SilverCrest Share and Coeur Canadian Sub shall be the holder of all of the outstanding SilverCrest
Shares, free and clear of all Liens.
(e) Treatment
of SilverCrest Options: Notwithstanding any vesting or exercise or other provisions to which a SilverCrest Option might
otherwise be subject (whether by contract, the conditions of grant, applicable Law or the terms of the applicable Company Option
Plan governing such SilverCrest Option), each SilverCrest Option outstanding immediately prior to the Effective Time shall, without
any further action by or on behalf of a holder, be exchanged for a Replacement Option exercisable to purchase from Coeur the number
of Coeur Shares (rounded down to the nearest whole number) equal to the product of (A) the number of SilverCrest Shares subject to
the SilverCrest Option immediately before the Effective Time multiplied by (B) the Exchange Ratio. The exercise price per Coeur
Share subject to any such Replacement Option shall be an amount (rounded up to the nearest whole cent) equal to the quotient of (X)
the exercise price per SilverCrest Share underlying the exchanged SilverCrest Option immediately prior to the Effective Time divided
by (Y) the Exchange Ratio. It is intended that (i) the provisions of Subsection 7(1.4) of the Tax Act apply to the aforesaid
exchange of options and (ii) such exchange of options be treated as other than the grant of a new stock right or a change in the
form of payment pursuant to Section 1.409A-1(b)(5)(v)(D) of the U.S. Treasury Regulations. Accordingly, and notwithstanding the
foregoing, if required, the exercise price of a Replacement Option will be adjusted such that the In-The-Money Value of the
Replacement Option immediately after the exchange does not exceed the In-The-Money Value of the SilverCrest Option for which it was
exchanged immediately before the exchange. All terms and conditions of a Replacement Option, including the term to expiry,
conditions to and manner of exercising, will be the same as the SilverCrest Option for which it was exchanged, provided that the
provisions of Section 7.1 of the New Company Option Plan shall apply to all Replacement Options that
would otherwise be governed by the Legacy Company Option Plan for a period of ninety (90) days following the Effective Time. |
| |
|
| |
(f) Amalgamation
of the Company and Company Canadian Sub: At 9:00 a.m. (Vancouver time) on the day following the Effective Date, the notice of articles
of the Company shall be altered to the extent necessary for the Company to become an unlimited liability company as contemplated pursuant
to the BCBCA, the name of the Company shall be |
| | SILVERCREST METALS INC. | 37 |
| | | 2025 Special Meeting of Securityholders |
| |
changed
to “SilverCrest Metals ULC” and the Company shall thereupon be an unlimited liability company under the BCBCA, and (iii)
Coeur Canadian Sub shall elect to be classified as an association taxable as a corporation for U.S. federal income tax purposes effective
the day following the Effective Date.
On completion of the
Arrangement, the Company will be a wholly-owned subsidiary of Coeur. See “The Arrangement” in this Circular.
|
| Treatment
of Other Company Incentive Awards |
· SilverCrest
PSUs: The Company shall take such action as may be required in order to ensure that all SilverCrest PSUs shall be fully vested
pursuant to Section 12.2(b) of the Company Share Unit Plan such that all the SilverCrest PSUs will all be redeemed by the Company
for cash, to be calculated in accordance with Section 7 of the Company Share Unit Plan immediately prior to the Effective Time. The
vesting multiplier for each Company PSU shall be calculated immediately prior to the Effective Time in accordance with the Company
Share Unit Plan and the individual award agreements.
· SilverCrest
DSUs: The Company shall take such action as may be required in order to ensure that all SilverCrest DSUs shall be fully vested
pursuant to Section 12.2(b) of the Company Share Unit Plan or Section 4.2 of the Company DSU Plan, as applicable, such that all the
SilverCrest DSUs will, as of immediately prior to the Effective Time, be redeemed by the Company for cash in accordance with Section
10 of the Company Share Unit Plan or Section 5 of the Company DSU Plan, as applicable.
· SilverCrest
RSUs: The Company shall take such action as may be required in order to ensure that all SilverCrest RSUs shall be fully vested
pursuant to Section 12.2(b) of the Company Share Unit Plan, such that all the SilverCrest RSUs will, as of immediately prior to the
Effective Time, be redeemed by the Company for cash in accordance with Section 7 of the Company Share Unit Plan. |
| Recommendation
of the Board |
Based on its considerations,
investigations and deliberations, including consultation with its financial and legal advisors, reviewing the Cormark Fairness Opinion,
the Raymond James Fairness Opinion and the unanimous recommendation of the Special Committee, which takes into account, among other
things, the Scotiabank Fairness Opinion, the Board unanimously determined that the Arrangement is in the best interests of the Company.
Accordingly, the Board unanimously approved the Arrangement and the entering into of the Arrangement Agreement and unanimously
recommends that the Securityholders vote FOR the Arrangement Resolution. Each director and officer of the Company
intends to vote all of such directors’ and officers’ SilverCrest Shares and SilverCrest Options FOR the
Arrangement Resolution. |
| |
|
| Background
to the Arrangement |
The provisions of the Arrangement
Agreement are the result of arm’s length negotiations between SilverCrest and Coeur and their respective legal and financial
advisors. See “The Arrangement – Background to the Arrangement” in this Circular. |
| Reasons
for the Arrangement |
In the course
of their evaluation, the Board and Special Committee carefully considered a variety of factors with respect to the Arrangement including,
among others, the following:
· Significant
Premium. The Consideration represents an implied value of US$11.34 per SilverCrest Share, being an 18% premium based on the 20-day
volume-weighted average prices of the Coeur Shares and SilverCrest Shares, each as at October 3, 2024 on the NYSE and NYSE American,
respectively, and a 22% premium to the October 3, 2024 closing price of SilverCrest Shares on the NYSE American, being the last trading
day prior to the announcement of the Arrangement. This also represents an all-time high in the value of SilverCrest Shares for Shareholders.
|
| | SILVERCREST METALS INC. | 38 |
| | | 2025 Special Meeting of Securityholders |
| |
· Meaningful
Exposure to Diverse Asset Portfolio. Current Shareholders will maintain exposure to the Company’s high-grade, low-cost
and high-margin Las Chispas Operation and will gain exposure to Coeur’s high quality and diversified portfolio consisting of
four robust operating mines in the U.S. and Mexico and an exploration property in Canada, with further potential upside from the
district-scale exploration potential of the Combined Company and organic mineral reserve growth. Current Shareholders will hold approximately
37% of the issued and outstanding shares of the Combined Company upon completion of the Arrangement, based on the number of securities
of Coeur and SilverCrest issued and outstanding as of October 3, 2024.
· Creation
of a Leading Global Silver Company. The addition of Las Chispas to Coeur’s growing silver production from its recently
expanded Rochester mine in Nevada and its Palmarejo underground mine in northern Mexico has the potential to generate significant
2025 silver production of approximately 21 million ounces from five North American operations, with approximately 56% of revenue
generated from U.S.-based mines and approximately 40% of revenue from silver. In addition to the significant silver production, it
is anticipated that the Combined Company can produce approximately 432,000 ounces of gold in 2025.
· Strong
Cash Flow and Deleveraging of Combined Company. The Combined Company is expected to generate approximately US$700 million of
EBITDA2 and US$350 million of free cash flow2 in 2025 at lower overall costs and higher overall margins
for Coeur. The Combined Company will also have more robust cash flow with the benefit of multiple producing mines in a diversified
portfolio. The strong cash flow profile of the Combined Company will be augmented by SilverCrest’s strong balance sheet and
no debt which are expected to result in an immediate 40% reduction in the Combined Company’s leverage ratio upon closing of
the Arrangement.
· Strategic
Review Process and Value Maximization. The Arrangement with Coeur is the culmination of a comprehensive strategic review process
that was initiated following Las Chispas achieving commercial production in late 2022, which process was overseen by the Board initially,
and subsequently, the Special Committee, with the assistance of the Company’s financial advisors (including Raymond James initially
in late 2022 and the addition of Cormark in 2024). During this process, the Company, through its financial advisors, canvassed numerous
other potential parties to determine market interest in a transaction involving, and explore various strategic opportunities available
to, SilverCrest (including maintaining status quo, asset purchases, merger of equals, acquisitions and a sale of the Company). This
process resulted in the evaluation of over 25 potential strategic
opportunities, the execution of more than 15 confidentiality agreements, substantive reviews and site visits
of more than 10 mineral properties and multiple site visits hosted at Las Chispas. See “The Arrangement
– Background to the Arrangement” for more details on the strategic review process undertaken
by the Company. After consultation on the proposed Arrangement with legal and financial advisors, and after
review of the current and prospective business climate in the precious metals mining industry and other strategic
opportunities reasonably available to SilverCrest, including continuing as an independent entity, potential
acquisitions and sales, in each case taking into account the potential benefits, risks and uncertainties associated
with those other opportunities, the Special Committee and the Board believe the Arrangement represents SilverCrest’s
best prospect for maximizing Shareholder value.
· Asset
diversification and elimination of single asset risk. The business, operations, assets, financial condition, operating results and
prospects of SilverCrest are subject to
|
2 This is a non-GAAP performance
measure. See “Management Information Circular – Non-GAAP Financial Performance Measures”.
| | SILVERCREST METALS INC. | 39 |
| | | 2025 Special Meeting of Securityholders |
| |
significant uncertainty, including, but not limited to, risks associated with SilverCrest’s dependency
on the Las Chispas Operation for its future operating revenue, permitting and regulatory approvals, exploration
and development risks and commodity price and inflation risks. The Combined Company will be better positioned
to pursue a growth and value maximizing strategy as compared with SilverCrest on a standalone basis, as a
result of the Combined Company’s larger market capitalization, asset and geographical diversification,
elimination of single asset risk, technical expertise, greater trading liquidity, enhanced access to capital
over the long term and the likelihood of increased investor interest and access to business development opportunities
due to the Combined Company’s larger market presence.
· Proven
Leadership Team. Following the Arrangement, two of the current directors of SilverCrest, Messrs. N. Eric Fier and Pierre Beaudoin,
will join the board of the Combined Company. Management of the Combined Company will feature proven and experienced mining and business
leaders at both the board and executive management levels, along with diverse, high performing teams at the regional and operating sites
with a proven track record of maximizing value by delivering long-life and profitable silver and gold mining operations. The Combined
Company will continue its commitment to ESG with a specific focus on water usage, emissions, community and workforce development, and
leading governance practices.
· Fairness
Opinions. The Special Committee received a fairness opinion from Scotiabank, and the Board received a fairness opinion from each
of Cormark and Raymond James, all dated October 3, 2024 to the effect that the Consideration to be received by the Shareholders pursuant
to the Arrangement is fair, from a financial point of view, to the Shareholders, based upon and subject to various assumptions, limitations
and qualifications set forth, respectively, in each such opinion, as more fully described under “The Arrangement – Fairness
Opinions”.
|
| |
|
| Voting
and Support Agreements |
The directors
and senior officers of SilverCrest have entered into the SilverCrest Voting Agreements with Coeur pursuant to which they have agreed
to, among other things, vote FOR the Arrangement Resolution. As of the Record Date, a total 3,441,935 SilverCrest Shares
and 1,680,436 SilverCrest Options are subject to the SilverCrest Voting Agreements, representing approximately 2.3% of the outstanding
SilverCrest Shares, and 3.4% of the outstanding SilverCrest Shares and SilverCrest Options collectively, that may be voted at the
Meeting.
The directors
and senior officers of Coeur have entered into the Coeur Voting Agreements with SilverCrest pursuant to which they have agreed to,
among other things, vote in favour of
the Coeur Charter Amendment and Coeur Stock Issuance. As of the record date of the Coeur Meeting, a total 6,045,787 Coeur Shares
are subject to the Coeur Voting Agreements, representing approximately 1.5% of the outstanding Coeur Shares that may be voted
at the Coeur Meeting. |
| |
|
| |
See
“The Arrangement – Voting and Support Agreements” in this Circular.
|
| |
|
| Conditions
to Completion of the Arrangement |
The implementation
of the Arrangement is subject to a number of conditions being satisfied or waived by SilverCrest or Coeur, as applicable, at or prior
to the Effective Date, including the following:
(a) the
Arrangement Resolution will have been approved and adopted by the Securityholders at the Meeting in accordance with the Interim Order;
(b) each
of the Interim Order and the Final Order will have been obtained on terms consistent with the Arrangement Agreement, and will not
have been set aside or
|
| | SILVERCREST METALS INC. | 40 |
| | | 2025 Special Meeting of Securityholders |
| |
modified in a manner unacceptable to either SilverCrest or Coeur, each acting reasonably, on appeal or otherwise;
(c)
the Coeur Stockholder Approvals will have been obtained
in accordance with the rules of the NYSE (with respect to the Coeur Stock Issuance) and the DGCL (with respect to the Coeur Charter
Amendment) at the Coeur Meeting;
(d)
the Coeur Charter Amendment will have been duly filed
with the Secretary of State of the State of Delaware and be in full force and effect;
(e) no
Law will have been in effect that makes the consummation of the Arrangement illegal or otherwise prohibits or enjoins SilverCrest
or Coeur from consummating the Arrangement (including, for the avoidance of doubt, any Law prohibiting the issuance of the Coeur
Shares or the Replacement Options without an exemption from the registration requirements of the U.S. Securities Act pursuant to
Section 3(a)(10));
(f) the
distribution of the Coeur Shares and the Replacement Options will be exempt from the prospectus and registration requirements of
applicable Canadian Securities Laws either by virtue of exemptive relief from the securities regulatory authorities of each of the
provinces and territories of Canada or by virtue of applicable exemptions under Canadian Securities Laws and shall not be subject
to resale restrictions under applicable Canadian Securities Laws;
(g) the
Consideration Shares to be issued pursuant to the Arrangement will have been approved for listing on the NYSE (subject only to official
notice of issuance);
(h)
the COFECE Approval will have been obtained and shall
not have been modified or rescinded; and
(i) the
Arrangement Agreement shall not have been terminated in accordance with its terms.
Completion of
the Arrangement Agreement is subject to a number of additional conditions precedent, of which the following are for the exclusive
benefit of Coeur and may be waived by Coeur. The conditions include, among other things: |
| | (a) all
covenants of SilverCrest under the Arrangement Agreement to be performed on or before the
Effective Time having been performed by SilverCrest in all material respects;
(b)
(i) the representations and warranties of SilverCrest
being true and correct as of the Effective Date as provided for in the Arrangement Agreement, except where it would not reasonably
be expected to have a Company Material Adverse Effect; and (ii) certain fundamental representations and warranties of SilverCrest
being true and correct in all respects (except for de minimis inaccuracies and as a result of transactions, changes, conditions,
events or circumstances permitted by the Arrangement Agreement);
(c) between
the date of the Arrangement Agreement and the Effective Time, there shall not have occurred a Company Material Adverse Effect that
is continuing as of the Effective Time; and
(d) Dissent
Rights not having been exercised (or, if exercised, not withdrawn) with respect to more than 5% of the issued and outstanding SilverCrest
Shares.
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Completion
of the Arrangement Agreement is also subject to number of additional conditions precedent, of which the following are for the exclusive
benefit of SilverCrest and may be waived by SilverCrest. The conditions include, among other things:
(a)
all covenants of Coeur under the Arrangement Agreement
to be performed on or before the Effective Time having been performed by Coeur in all material respects;
(b)
(i) the representations and warranties of Coeur being
true and correct as of the Effective Date as provided for in the Arrangement Agreement, except it would not reasonably be expected
to have a Coeur Material Adverse Effect; and (ii) certain fundamental representations and warranties of Coeur being true and correct
in all respects (except for de minimis inaccuracies and as a result of transactions, changes, conditions, events or circumstances
permitted by the Arrangement Agreement);
(c)
Coeur having deposited, or caused to be deposited,
with the Depositary sufficient Coeur Shares to satisfy its obligations under the Arrangement, and the Depositary having confirmed
to SilverCrest its receipt of such Coeur Shares;
(d)
between the date of the Arrangement Agreement and
the Effective Time, there shall not have occurred a Coeur Material Adverse Effect that is continuing as of the Effective Time; and
(e)
the Company Director Nominees (to the extent they
consented to their appointment) having been appointed to the Coeur Board effective as of the Effective Time.
See “The
Arrangement Agreement – Conditions to Closing” in this Circular. |
| |
|
| Non-Solicitation and Right to Match |
In the
Arrangement Agreement, SilverCrest has agreed, subject to certain exceptions, that it will not, directly or indirectly, solicit or
participate in any discussions or negotiations regarding a proposal by a third party to acquire the Company or its assets and will
give prompt notice to Coeur should SilverCrest receive such a proposal or a request for non-public information that it reasonably
believes would lead to such a proposal. In the case of a Company Superior Proposal, Coeur has the right but not the obligation to
amend the Arrangement
Agreement to provide a proposal that would render the previously received Company Superior Proposal to no
longer constitute a Company Superior Proposal |
| |
In the Arrangement
Agreement, Coeur has agreed, subject to certain exceptions, that it will not, directly or indirectly, solicit or participate in any discussions
or negotiations regarding a proposal by a third party to acquire Coeur or its assets and will give prompt notice to SilverCrest should
Coeur receive such a proposal or a request for non-public information that it reasonably believes would lead to such a proposal. In the
case of a Coeur Superior Proposal, SilverCrest has the right but not the obligation to amend the Arrangement Agreement to provide a proposal
that would render the previously received Coeur Superior Proposal to no longer constitute a Coeur Superior Proposal.
See “The Arrangement Agreement –
Covenants Regarding Non-Solicitation and Acquisition Proposals” in this Circular.
|
| |
|
| Termination
of Arrangement Agreement |
SilverCrest and Coeur may mutually agree in writing
to terminate the Arrangement Agreement and abandon the Arrangement at any time prior to the Arrangement becoming effective. In addition,
SilverCrest or Coeur may terminate the Arrangement Agreement and abandon the Arrangement at any time prior to the Effective Date if certain
specific events, which are outlined in the Arrangement Agreement, occur. Depending on the termination event, the Company Termination
Payment may be payable by SilverCrest to Coeur or the Coeur Termination Payment
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| |
may
be payable by Coeur to SilverCrest. In addition, the Expense Reimbursement may be payable by either SilverCrest
or Coeur to the other Party in certain circumstances.
See “The Arrangement
Agreement – Termination of the Arrangement Agreement” in this Circular.
|
| |
|
| Fairness
Opinions |
The Special
Committee received the Scotiabank Fairness Opinion, and the Board received the Cormark Fairness Opinion and Raymond James Fairness
Opinion. Each of the Fairness Opinions concludes that, as of the date of the Arrangement Agreement, and subject to and based on the
assumptions, limitations and qualifications described therein, the Consideration is fair, from a financial point of view, to the
Shareholders.
See “The
Arrangement – Fairness Opinions” in this Circular and Appendix E, Appendix F and Appendix G. |
| |
|
| Letter of Transmittal |
A Letter
of Transmittal for the Registered Shareholders is enclosed with this Circular. If the Arrangement becomes effective, in order to
receive a physical certificate(s) or DRS Advice(s) representing Coeur Shares to which the Shareholder is entitled under the Plan
of Arrangement in exchange for the SilverCrest Shares, a Registered Shareholder must deliver the Letter of Transmittal properly completed
and duly executed, together with share certificate(s) or DRS Advice(s) representing its SilverCrest Shares and all other required
documents to the Depositary at the address set forth in the Letter of Transmittal. If the Arrangement is not completed, the Letter
of Transmittal will be of no effect and the Depositary will return all share certificates or DRS Advices representing the SilverCrest
Shares to the holders thereof as soon as practicable at the address specified in the Letter of Transmittal.
Shareholders
whose SilverCrest Shares are registered in the name of an Intermediary must contact their Intermediary to receive the Consideration.
If a Shareholder
following the Effective Date fails to deliver and surrender its SilverCrest Shares to the Depositary by the date that is six years
after the Effective Date, then the certificate(s) or DRS Advice(s) representing such Coeur Shares, to which such former Shareholder
was entitled, shall be delivered to Coeur by the Depositary and the share certificates or DRS Advices shall
be cancelled by Coeur, and the interest of the former Shareholder in such Coeur Shares to which it was entitled
shall be terminated as of such date. |
| |
Only Registered
Shareholders are required to submit a Letter of Transmittal. A Beneficial Shareholder holding SilverCrest Shares through an Intermediary
should contact that Intermediary for instructions and carefully follow any instructions provided by such Intermediary.
See “The Arrangement – Exchange
of SilverCrest Securities” in this Circular.
|
| |
|
| No
Fractional Shares to be Issued |
No fractional Coeur Shares
will be issued to former Shareholders. Where the aggregate number of Coeur Shares to be issued to a Shareholder under the Arrangement
would result in a fractional Coeur Share being issuable, such fractional Coeur Share will be rounded up to the nearest whole Coeur
Share in the event that a Shareholder is entitled to a fractional share representing 0.5 or more of a Coeur Share and will be rounded
down to the nearest whole Coeur Share in the event that a Shareholder is entitled to a fractional share representing less than 0.5
of a Coeur Share. |
| |
|
| Withholding
Rights |
SilverCrest,
Coeur, the Depositary and any other person, as applicable will be entitled to deduct or withhold from any Consideration otherwise
payable, issuable or otherwise deliverable to any Securityholder under the Plan of Arrangement (including any payment to Dissenting
Shareholders and Optionholders) such amounts as SilverCrest, Coeur, the Depositary or any other person, as the case may be, is required
to deduct or withhold from such payment under any provision of the Tax
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| |
Act, and the rules and regulations promulgated thereunder,
or any provision of any federal, provincial, territorial, state, local or foreign tax law as is required to be so deducted or withheld
by SilverCrest, Coeur or the Depositary or any other person, as the case may be.
See “The
Arrangement – Exchange of SilverCrest Securities – Withholding Rights”. |
| Court
Approval of the Arrangement |
Subject to
the terms of the Arrangement Agreement and, if the Arrangement Resolution is approved at the Meeting, SilverCrest intends to apply
to the Court for the Final Order. The hearing of the application for the Final Order is expected to be held at the courthouse of
the Court at 800 Smithe Street, Vancouver, British Columbia at 9:45 a.m. (Vancouver time) on February 11, 2025, or as soon thereafter
as counsel may be heard, or at any other date and time and by any method as the Court may direct. Please see the Petition and Notice
of Hearing of Petition, attached as Appendix D to this Circular, and the Interim Order, attached as Appendix C to this Circular,
for further information on participating or presenting evidence at the hearing for the Final Order. At the hearing, the Court will
consider, among other things, substantive and procedural fairness of the Arrangement. The Court may approve the Arrangement in any
manner the Court may direct, subject to compliance with such terms and conditions, if any, as the Court deems fit.
See “The
Arrangement – Court Approval of the Arrangement” in this Circular. |
| Exchange
Approvals |
Coeur Shares
are listed on the NYSE and it is a condition of the Arrangement that the Coeur Shares to be issued or issuable in connection with
the Arrangement are approved for listing on the NYSE, subject only to official notice of issuance.
SilverCrest Shares
are listed on the TSX and NYSE American and the completion of the Arrangement is subject to the prior conditional approval of the
TSX. Following completion of
the Arrangement the SilverCrest Shares will be delisted from the TSX and NYSE American. |
| |
|
| COFECE
Approval |
Under Mexican
Antitrust Law, there are certain monetary thresholds which trigger the obligation of economic agents to notify concentrations with
the COFECE and be approved before they are consummated.
As of the
date of this Circular, the review of the transactions contemplated by the Arrangement Agreement by COFECE is ongoing and the COFECE
Approval required under the Arrangement Agreement has not yet been obtained.
See “The
Arrangement – COFECE Approval” in this Circular. |
| Canadian
Securities Law Matters |
SilverCrest
is a reporting issuer in all of the provinces of Canada except Québec. The SilverCrest Shares currently trade on the TSX and
NYSE American. After the Arrangement, SilverCrest will be a wholly-owned subsidiary of Coeur, the SilverCrest Shares will be delisted
from the TSX and NYSE American (delisting is anticipated to be effective one or two business days following the Effective Date) and
Coeur expects to apply to the applicable Canadian Securities Authorities to have SilverCrest cease to be a reporting issuer.
The distribution
of the Coeur Shares and the issuance of Replacement Options pursuant to the Arrangement will constitute a distribution of securities
which is exempt from the prospectus requirements of Canadian Securities Laws. The Coeur Shares received pursuant to the Arrangement
will not be legended and may be resold through registered dealers in each of the provinces and territories of Canada provided that
(i) the trade is not a “control distribution” as defined National Instrument 45-102 – Resale of Securities
of the Canadian Securities Administrators, (ii) no unusual effort is made to prepare the market or to create a demand for the Coeur
Shares, as the case may be, (iii) no extraordinary commission or consideration is paid to a person or company in respect of such
sale, and (iv) if the selling security holder is an insider or
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| |
officer of Coeur, the selling security holder has no reasonable grounds
to believe that Coeur is in default of Canadian Securities Laws.
Each Securityholder
is urged to consult his or her professional advisors to determine the Canadian conditions and restrictions applicable to trades in
Coeur Shares issuable pursuant to the Arrangement.
See “The
Arrangement – Regulatory Matters and Securities Law Matters – Canadian Securities Law Matters”. |
| United
States Securities Law Matters |
The Coeur Shares and the
Replacement Options to be issued to Securityholders pursuant to the Arrangement have not been and will not be registered under the
U.S. Securities Act or the Securities Laws of any state of the United States and will be issued and exchanged in reliance upon Section
3(a)(10) of the U.S. Securities Act and exemptions provided under the Securities Laws of each state of the United States in which
Securityholders reside. The exemption from the registration requirements of the U.S. Securities Act provided by Section 3(a)(10)
thereof for the issuance of the Replacement Options does not exempt the issuance of securities upon the exercises of such Replacement
Options and Coeur Shares issuable upon the exercise of the Replacement Options may be issued only pursuant to an exemption from,
or in a transaction not subject to, the registration requirements of the U.S. Securities Act and applicable state U.S. Securities
Laws or following registration under such laws, if any. |
| |
|
| Interests
of Certain Directors and Senior |
In considering the recommendation
of the Board, Securityholders should be aware that certain members of the Board and the senior officers of SilverCrest have interests
in the |
| |
|
| Officers
of SilverCrest in the Arrangement |
Arrangement
or may receive benefits that may differ from, or be in addition to, the interests of Securityholders generally.
See “The
Arrangement – Interests of Certain Persons in the Arrangement” in this Circular. |
| Rights
of Dissent |
Pursuant
to the Interim Order, Registered Shareholders as at the close of business on the Record Date have the right to dissent with respect
to the Arrangement Resolution and, if the Arrangement becomes effective, to be paid the fair value of their SilverCrest Shares in
accordance with the provisions of Sections 237 to 247 of the BCBCA, as modified by the Interim Order and the Plan of Arrangement.
A Registered Shareholder as at the close of business on the Record Date wishing to exercise rights of dissent with respect to the
Arrangement must send to the Company a written objection to the Arrangement Resolution, which written objection must be sent to the
Company c/o Cassels, Brock & Blackwell LLP, Suite 2200, RBC Place, 885 West Georgia Street, Vancouver, BC V6C 3E8, Attention:
Rajit Mittal, by no later than 4:00 p.m. (Vancouver time) on February 4, 2025 (or by 4:00 p.m. (Vancouver time) on the second business
day immediately preceding the date that any adjourned or postponed Meeting is reconvened), and must otherwise strictly comply with
the set forth in Sections 237 to 247 of the BCBCA, as modified by the Interim Order and the Plan of Arrangement.
See “The
Arrangement – Dissenting Shareholders’ Rights” in this Circular. The text of Section 242(1)(a) of the BCBCA,
which will be relevant in any dissent proceeding, is set forth in Appendix K to this Circular. |
| Risk Factors |
There is
a risk that the Arrangement may not be completed. If the Arrangement is not completed, SilverCrest will continue to face the risks
that it currently faces with respect to its affairs, business and operations and future prospects. Additionally, failure to complete
the Arrangement could materially and negatively impact the trading price of the SilverCrest Shares.
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| |
The risk
factors described under the heading “Risk Factors” and under the heading “Risk Factors” in
Appendix H attached to this Circular should be carefully considered by Securityholders. |
| Canadian
and United States Tax Considerations |
Securityholders should carefully
review the tax considerations described in this Circular and are urged to consult their own tax advisors in regard to their particular
circumstances. See “Certain Canadian Federal Income Tax Considerations” and “Certain United States Federal
Income Tax Consequences of the Arrangement” for a discussion of certain Canadian federal income tax considerations and
United States income tax considerations, respectively. |
| |
|
| Information
Concerning SilverCrest |
SilverCrest
is a Canadian-based precious metals producer headquartered in Vancouver, British Columbia, with an ongoing initiative to increase
its silver-gold assets by expanding current resources and reserves, acquiring, discovering, developing and operating high value precious
metal projects in the Americas. The Company’s principal focus is operating its Las Chispas Operation, located near Hermosillo,
Sonora, Mexico. The Company has a portfolio of three other mineral exploration properties in Sonora, Mexico, comprised of El Picacho,
Cruz de Mayo, and Angel de Plata properties. The SilverCrest Shares are currently traded on the TSX under the symbol “SIL”
and on the NYSE American under the symbol “SILV”.
See “Information
Concerning SilverCrest” in this Circular. |
| |
|
| Information
Concerning Coeur |
Coeur is
a precious metals producer with assets located in the United States, Canada and Mexico. Coeur produces and sells precious metals
from: (i) the Palmarejo gold-silver complex, located in the State of Chihuahua in northern Mexico; (ii) the Rochester silver-gold
mine located in northwestern Nevada; (iii) the Kensington gold mine located north of Juneau, Alaska; and (iv) the Wharf gold mine
located near Lead, South Dakota. In addition, Coeur operates the Silvertip silver-zinc-lead exploration project located in northern
British Columbia, Canada. Coeur Shares are listed on the NYSE under the symbol “CDE”.
See Appendix
H “Information Concerning Coeur” in this Circular. |
| Information
Concerning the Combined Company |
On completion
of the Arrangement, Coeur will indirectly own all of the outstanding SilverCrest Shares and SilverCrest will be a wholly-owned subsidiary
of Coeur. Following completion of the Arrangement, existing SilverCrest Shareholders and Coeur Stockholders are expected to own approximately
37% and 63% of the Combined Company, respectively, in each case based on the number of securities of SilverCrest and Coeur issued
and outstanding on October 3, 2024.
See Appendix
I “Information Concerning the Combined Company” and Appendix J “Unaudited Pro Forma Financial Information”
in this Circular. |
| Pro
Forma Financial Information |
The unaudited
pro forma condensed combined financial statements included in this Circular give effect to the Arrangement and certain related
adjustments described in the notes accompanying such financial statements. The unaudited pro forma condensed combined balance
sheet as at September 30, 2024 gives effect to the Arrangement as if the Arrangement was completed on September 30, 2024.
The unaudited pro forma condensed combined statements of operations for the year ended December 31, 2023 and for the nine
months ended September 30, 2024 give effect to the Arrangement as if all such transactions had closed on January 1, 2023. The unaudited
pro forma condensed combined financial statements are based on the respective historical audited consolidated financial statements
of SilverCrest and Coeur each as at and for the year ended December 31, 2023, and the unaudited condensed consolidated interim financial
statements of SilverCrest and Coeur as at and for the nine months ended September 30, 2024. The unaudited pro forma condensed
combined financial statements should be read together with: (i) the Company Annual Financial Statements incorporated by reference
into this Circular, (ii) the Coeur Annual Financial Statements incorporated by reference into this Circular, (iii) the Company
Interim Financial Statements incorporated by reference into this Circular, (iv) the Coeur Interim Financial
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| |
Statements incorporated
by reference into this Circular, and (v) other information contained in or incorporated by reference into this Circular. SilverCrest’s
historical consolidated financial statements were prepared in accordance with IFRS Accounting Standards and historical quarterly
statements were prepared in accordance with IAS 34, which differ in certain respects from GAAP. Adjustments were made to SilverCrest’s
financial statements to convert those from IFRS Accounting Standards to GAAP as well as reclassifications to conform SilverCrest’s
historical accounting presentation to Coeur’s accounting presentation.
See “Management
Information Circular – Pro Forma Financial Information” and Appendix J “Unaudited Pro Forma Financial Information”
in this Circular. |
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INFORMATION
CONCERNING THE MEETING
Purpose of the
Meeting
At the Meeting,
Securityholders will be asked to consider and, if deemed acceptable, to pass, with or without variation, the Arrangement Resolution.
The approval of the Arrangement Resolution will require the required Securityholder Approval.
Date, Time and
Place of the Meeting
The Meeting will
be held on February 6, 2025 at 10:00 a.m. (Vancouver time) at the offices of Cassels Brock & Blackwell LLP at Suite 2200, RBC Place,
885 West Georgia Street, Vancouver, British Columbia. The Meeting can also be accessed via live webcast at meetnow.global/MHZWLAD. Any
Securityholder attending the live webcast will not be able to vote during the Meeting. Only Securityholders or their duly appointed proxyholders
who are present in person at the Meeting are able to vote during the Meeting.
Record Date
Pursuant to the
Interim Order, the Record Date for determining persons entitled to receive notice of and vote at the Meeting is December 19, 2024. Securityholders
of record as at the close of business (Vancouver time) on December 19, 2024 will be entitled to attend and vote at the Meeting, or any
adjournment or postponement thereof, in the manner and subject to the procedures described in this Circular.
Solicitation of
Proxies
The Company is
providing this Circular and a form of proxy in connection with management’s solicitation of proxies for use at the Meeting of the
Company to be held on February 6, 2025 and at any postponement(s) or adjournment(s) thereof. Unless the context otherwise requires, when
we refer in this Circular to the Company, any subsidiaries are also included.
The solicitation
of proxies will be primarily by mail, but proxies may be solicited personally or by telephone by directors, officers and regular employees
of the Company. All costs of this solicitation will be borne by the Company. The Company has also retained Laurel Hill as its proxy solicitation
agent, to assist in the solicitation of proxies with respect to the matters to be considered at the Meeting. For these services, Laurel
Hill will receive a fixed C$115,000 advisory fee, in addition to a fee for retail shareholder calls and certain out-of-pocket expenses.
Appointment of
Proxyholders
If you do not
attend and vote at the Meeting, you can still make your votes count by appointing a person or company who will attend the Meeting to
act as your proxyholder at the Meeting.
Your proxyholder
is the person you appoint and name on the proxy form to cast your votes for you. You can appoint the persons named in the applicable
enclosed form or forms of proxy, who are each a director or an officer of SilverCrest. You have the right to appoint any person
or company you want to be your proxyholder. It does not have to be a Securityholder or the person designated in the enclosed form(s).
Simply indicate the person’s name as directed on the enclosed proxy form(s) or complete any other legal proxy form and deliver
it to Computershare Investor Services Inc. within the time hereinafter specified for receipt of proxies.
Securityholders
who wish to appoint a third-party proxyholder to attend and vote at the Meeting as their proxy and vote their securities MUST submit
their proxy (or proxies) or VIF, as applicable, appointing such third-party proxyholder following the instructions provided in such form
of proxy or VIF, as applicable.
If you are a Beneficial
Shareholder and wish to attend or vote at the Meeting, you have to insert your own name in the space provided on the VIF sent to you
by your Intermediary and follow all of the applicable instructions provided by your Intermediary. By doing so, you are instructing
your Intermediary to appoint you as proxyholder. It is important that you comply with the signature and return instructions provided
by your Intermediary.
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To vote your
securities, your proxyholder must attend and vote at the Meeting. Regardless of who you appoint as your proxyholder, you can either instruct
that appointee how you want to vote or you can let your appointee decide for you. You can do this by completing the applicable form or
forms of proxy. In order to be valid, you must return the completed form of proxy 48 hours, excluding Saturdays, Sundays and holidays,
prior to the time of the Meeting or any adjournment or postponement thereof to our Transfer Agent, Computershare Investor Services Inc.,
100 University Avenue, 8th Floor, Toronto, Ontario M5J 2Y1, Attention: Proxy Department or by fax to 1-866-249-7775 (toll-free).
The Chair of the Meeting, in his or her sole discretion, may accept late proxies or waive the deadline for accepting proxies.
Proxy Instructions
Only Securityholders
whose names appear on the records of the Company as at the Record Date as the registered holders of the SilverCrest Shares and SilverCrest
Options or duly appointed proxyholders are permitted to vote at the Meeting. Registered Shareholders and Optionholders may wish to vote
by proxy whether or not they are able to attend the Meeting. Registered Shareholders and Optionholders may vote by mail or on the internet.
To vote online at www.investorvote.com, you will need to enter your 15-digit control number (located on the bottom left corner
of the first page of the form of proxy) to identify yourself as a Registered Shareholder or Optionholder on the voting website. Completed
forms of proxy must be deposited with the Transfer Agent, Computershare Investor Services Inc., 100 University Avenue, 8th
Floor Toronto, Ontario M5J 2Y1 by 10:00 a.m. (Vancouver time) on February 4, 2025 or, if the Meeting is adjourned, by 10:00 a.m. (Vancouver
time) on the second last business day prior to the date on which the Meeting is reconvened.
Revocability of
Proxies
A Registered
Shareholder or Optionholder who has submitted a proxy may revoke it at any time prior to the exercise thereof at the Meeting or any adjournment
or postponement thereof. In addition to revocation in any other manner permitted by law, a proxy may be revoked by:
| (a) | executing
a valid notice of revocation or other instrument in writing, by the Registered Shareholder,
Optionholder or such holders’ authorized attorney in writing, or, if such a holder
is a corporation, under its corporate seal by an officer or duly authorized attorney, and
by delivering the notice of revocation or other instrument in writing to the Transfer Agent
at 100 University Avenue, 8th Floor, Toronto, Ontario, M5J 2Y1 or to the registered
office of SilverCrest at 19th Floor, 885 West Georgia Street, Vancouver, British
Columbia V6C 3H4, at any time up to and including the last business day that precedes the
day of the Meeting or, if the Meeting is adjourned, the last business day that precedes any
reconvening thereof, or to the Chair of the Meeting on the day of the Meeting or any reconvening
thereof, or in any other manner provided by law; or |
| (b) | personally
attending the Meeting and voting the SilverCrest Shares or SilverCrest Options, as applicable. |
Upon such deposit,
the proxy is revoked. A revocation of a proxy will not affect a matter on which a vote is taken before the revocation.
If you are a
Beneficial Shareholder, please contact your Intermediary for instructions on how to revoke your VIF and what procedures you need to follow.
The change or revocation of a VIF by a Beneficial Shareholder can take several days or longer to complete and, accordingly, any such
action should be completed well in advance of the deadline given in the VIF by the Intermediary or its service company to ensure it is
effective.
Exercise of Discretion
On a poll, the nominees
named in the accompanying form of proxy will vote or withhold from voting the SilverCrest Shares and SilverCrest Options represented
thereby in accordance with the instructions of the Securityholder on any ballot that may be called for. If a Securityholder specifies
a choice with respect to any matter to be acted upon, such Securityholder’s SilverCrest Shares and/or SilverCrest Options will
be voted accordingly. The proxy will confer discretionary authority on the nominees named therein with respect to each matter or group
of matters identified therein for which a choice is not specified and any amendment to or variation of any matter identified therein
and any other matter that properly comes before the Meeting.
If a Securityholder
does not specify a choice in the proxy and the Securityholder has appointed one of the management nominees named in the accompanying
form of proxy, the management nominee will vote the SilverCrest Shares and SilverCrest Options
| | SILVERCREST METALS INC. | 49 |
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represented by the proxy FOR the
matters specified in the Notice of Meeting and FOR all other matters proposed by management at the Meeting.
As of the date
of this Circular, management of the Company knows of no amendment, variation or other matter that may come before the Meeting but, if
any amendment, variation or other matter properly comes before the Meeting, each nominee in the accompanying form of proxy intends to
vote thereon in accordance with the nominee’s best judgment.
Advice to Beneficial
(Non-Registered) Shareholders
If you are a
Beneficial Shareholder, meaning your SilverCrest Shares are not registered in your own name, they will be held in the name of a “nominee”,
usually a bank, trust company, securities dealer, other financial institution or intermediary, or depository, such as CDS & Co.,
of which an intermediary was a participant and, as such, your nominee will be the entity legally entitled to vote your SilverCrest Shares
and must seek your instructions as to how to vote your SilverCrest Shares.
If you are a
Beneficial Shareholder, your Intermediary will send you a VIF or, less frequently, a proxy form with this Circular. This form will instruct
the Intermediary as to how to vote your SilverCrest Shares at the Meeting on your behalf. You must follow the instructions from your
Intermediary to vote.
There are two
kinds of Beneficial Shareholders: (i) those who object to their name being made known to the issuers of securities which they own, known
as objecting beneficial owners (“OBOs”); and (ii) those who do not object to their name being made known to the issuers
of securities which they own, known as non-objecting beneficial owners (“NOBOs”).
Intermediaries
are required to forward the Meeting materials to Beneficial Shareholders unless in the case of certain proxy-related materials the Beneficial
Shareholder has waived the right to receive them. The majority of Intermediaries now delegate responsibility for obtaining instructions
from Beneficial Shareholders to Broadridge. Broadridge typically mails a VIF to Beneficial Shareholders and asks Beneficial Shareholders
to return the VIF to Broadridge. The Company may utilize Broadridgeʼs QuickVoteTM system to assist NOBOs with voting
their SilverCrest Shares over the telephone.
For greater certainty,
Beneficial Shareholders should note that they are not entitled to use a VIF or proxy form received from Broadridge or their Intermediary
to vote SilverCrest Shares directly at the Meeting. Instead, the Beneficial Shareholder must complete the VIF or proxy form and return
it as instructed on the form. The Beneficial Shareholder must complete these steps well in advance of the Meeting in order to ensure
such SilverCrest Shares are voted.
If you are a
Beneficial Shareholder, your intermediary will have provided to you a VIF. SilverCrest intends to reimburse intermediaries for the delivery
of the meeting materials to OBOs.
In the alternative,
if you wish to attend and vote at the Meeting or have another person attend and vote on your behalf, indicate your name or the name of
your proxyholder, as applicable, in the VIF or proxy form, and return it as instructed by your Intermediary. You will also have to register
yourself as your proxyholder, as described above in “Appointment of Proxyholders”. Your Intermediary may have also
provided you with the option of appointing yourself or someone else to attend and vote on your behalf at the Meeting.
Beneficial Shareholders
who have questions or concerns regarding any of these procedures may contact their Intermediary or Laurel Hill. It is recommended that
inquiries of this kind be made well in advance of the Meeting.
Notice-and-Access
The Company is not
sending this Circular to Registered Shareholders, Optionholders or Beneficial Shareholders using “notice-and-access” as defined
under NI 54-101.
VOTING
SECURITIES AND PRINCIPAL HOLDERS THEREOF
The Company has
an authorized capital consisting of an unlimited number of SilverCrest Shares without par value. As at the Record Date, a total of 149,188,518
SilverCrest Shares were issued and outstanding. The SilverCrest Shares carry the right to vote at the Meeting, with each SilverCrest
Share entitling the holder thereof to one vote on the Arrangement Resolution.
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Optionholders
will also be entitled to vote with the Shareholders together as a single class on the Arrangement Resolution, with one vote for each
SilverCrest Option held. As at the Record Date, a total of 2,365,586 SilverCrest Options exercisable into a total of 2,365,586 SilverCrest
Shares were issued and outstanding. At the date of the Circular, a total of 2,363,920 SilverCrest Options will carry the right to vote
at the Meeting, subject to decrease for any SilverCrest Options duly exercised before the Meeting. Accordingly, the maximum number of
potential votes at the Meeting in respect of the outstanding SilverCrest Shares and SilverCrest Options totals 151,554,104.
To the knowledge
of the directors or executive officers of the Company as of the Record Date, there are no persons who beneficially own, directly or indirectly,
or exercise control or direction over, SilverCrest Shares carrying 10% or more of the voting rights of Shareholders at the Meeting or
SilverCrest Shares and SilverCrest Options that collectively will carry 10% or more of the voting rights of Securityholders at the Meeting.
Under the Company’s
articles, the quorum for the transaction of business at the Meeting will be two Shareholders, present in person or represented by proxy,
holding in the aggregate at least 5% of the issued shares entitled to be voted at the Meeting.
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THE
ARRANGEMENT
Background to the
Arrangement
Strategic
Review Process
The Arrangement
Agreement is the culmination of a comprehensive strategic review process overseen by the Board and the Special Committee, and is the
direct result of extensive arm’s length negotiations among representatives of SilverCrest and the Special Committee, representatives
of Coeur, and their respective financial and legal advisors. The following is a summary of the principal events leading up to the execution
and public announcement of the Arrangement Agreement.
While the Company
has been primarily focused on the continuous operation and optimization of the Las Chispas Operation, SilverCrest’s management
and the Board regularly review the overall corporate strategy and the long-term strategic plan, with the goal of maximizing shareholder
value and taking into consideration other stakeholders. Following Las Chispas achieving commercial production in late 2022, the Company
began undertaking a strategic review process to evaluate a range of potential strategic alternatives to enhance shareholder value. This
process was overseen by the Board initially (and, subsequently, the Special Committee as described below), with the assistance of the
Company’s financial advisors. During this process, the Company met with numerous other potential parties to determine market interest
in a transaction involving, and explore various strategic opportunities available to, SilverCrest (including maintaining the status quo,
asset purchases, merger of equals, acquisitions as well as a sale of the Company). Under the oversight of the Board initially (and, subsequently,
the Special Committee), all of the aforementioned potential options were considered and the Company evaluated over 25 potential strategic
opportunities, entered into more than 15 confidentiality agreements, completed various substantive reviews and site visits of more than
10 mineral properties, and hosted multiple site visits at Las Chispas.
Over the course
of the Company’s strategic review process, the Company analyzed various initiatives with each of the prospective counterparties
with whom the Company entered into confidentiality agreements. In late 2023 and early 2024, the Company had discussions with a counterparty
in respect of a potential merger of equals transaction and entered into a mutual confidentiality agreement on January 11, 2024 to facilitate
further due diligence, including reciprocal site visits completed by the parties, but this process did not ultimately result in any offer
or understanding.
The Company continued
its strategic review process over the course of early 2024, which culminated in the identification of two viable strategic alternatives
with a potentially compelling opportunity to enhance shareholder value, being the Arrangement with Coeur or a potential acquisition by
the Company of a producer (“Party 1”), each as described further below.
Given the various
potential counterparties and transaction structures that were under consideration, the Board determined it was in the best interest of
the Company to establish a special committee of independent directors to provide guidance to senior management in respect of the strategic
review process and the negotiations of any potential transaction, ensure that the Board exercised an appropriate degree of oversight,
and to ultimately make recommendations to the Board with respect to any proposed transaction. The Board formed an opportunities committee
of independent directors in the fall of 2023 and received monthly updates from SilverCrest’s management with respect to the strategic
review process. This committee was formalized into the Special Committee on May 4, 2024 and was comprised of independent directors John
Wright (Chair), Anna Ladd-Kruger and Hannes Portmann. At the time of appointment, each member of the Special Committee confirmed their
independence within the meaning of MI 61-101 and NI 52-110. Each of the Special Committee members also plays key roles in the oversight
of the governance of the Company generally, with Mr. Wright serving as the Chair of the Board, Ms. Ladd-Kruger as the Chair of the Audit
Committee of the Board, and Mr. Portmann as the Chair of the Compensation Committee of the Board.
The Board also
approved the Special Committee’s initial written mandate, which included, among other things: (i) oversight, with final
approval by the Board, of the Company’s strategic review processes; (ii) examination and review of the proposed structure,
merits, risks, relevant advantages and disadvantages and the feasibility of pursuing any potential transaction; (iii) evaluation of
the terms and conditions of any potential transaction; (iv) negotiation of the terms for any potential transaction (subject to Board
approval), with the assistance of the Company’s legal and financial advisors; and (v) review, evaluation and recommendations
to the Board regarding any potential transaction, including consultation with management and advisors of the Company. On
May 13, 2024, the Company’s Canadian legal counsel, Cassels, provided legal advice to the Board as to its role and
function, including the Board’s processes and fiduciary duties in the context of a proposed transaction, and responded to
various questions throughout this process.
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Engagement
with Party 1
Beginning in
March and through early August 2024, the Company evaluated and considered a potential transaction with Party 1. The Company and Party
1 entered into a mutual confidentiality agreement on April 1, 2024 and thereafter they conducted extensive reciprocal financial, technical,
operational and legal due diligence, resulting in the Company submitting a non-binding indicative proposal, which provided for a potential
acquisition of Party 1 by the Company in an all-stock transaction. Raymond James was formally engaged by the Company as its financial
advisor on June 6, 2024 in connection with the potential transaction with Party 1 and any other potential transactions.
Following the
submission of the non-binding proposal to Party 1, legal advisors to Party 1 provided the Company with a proposed draft of the definitive
agreement with respect to a potential transaction. The parties also continued their respective due diligence investigations, including
reciprocal site visits to the parties’ mineral properties. Management and Raymond James presented the Special Committee and the
Board with a detailed review of the proposed transaction with Party 1, and Cassels and the Company’s U.S. counsel, Paul, Weiss,
delivered legal due diligence reports to the Company’s management and Board. This ultimately culminated in the submission by the
Company to Party 1 of a final, binding proposal (the “Party 1 Proposal”) and a proposed mark-up of a draft definitive
agreement on July 29, 2024, which were overseen, considered and reviewed by the Special Committee and authorized by the Board, with advice
from Raymond James, Cassels and Paul, Weiss.
Engagement
with Coeur
Concurrent with
the Company’s engagement with Party 1, the Company was also engaged with Coeur with respect to a potential transaction.
Management of
SilverCrest and Coeur met at the Gold Forum Americas on September 18, 2023, during which Mr. N. Eric Fier, the Chief Executive Officer
and a director of SilverCrest, Ms. Tara Hassan, the VP, Corporate Development of SilverCrest, Mr. Thomas Whelan, the Senior Vice President
and Chief Financial Officer of Coeur, and Mr. Patrick Booth, the Director, Corporate Development of Coeur had preliminary discussions
regarding potential strategic opportunities, recognizing the potential strategic benefits for both companies. This was followed by a
subsequent meeting between Mr. Fier, Ms. Hassan, Mr. Mitchell Krebs, Chairman, President and Chief Executive Officer of Coeur, and
Mr. Whelan at the BMO Global Metals, Mining and Critical Minerals Conference on February 25, 2024. SilverCrest’s management team
updated the Board about the potential opportunities being discussed with Coeur. While the discussions had not resulted in any specific
proposal, the Parties were interested in continuing to explore the benefits of a potential transaction and entered into the Confidentiality
Agreement on April 17, 2024 to facilitate further discussions and enable the exchange of confidential information between the Parties.
Between April
18 and 20, 2024, members of SilverCrest’s management and operational teams visited Coeur’s Palmarejo mine to conduct on-site
diligence. This was followed by a due diligence discussion on May 1, 2024 between Ms. Hassan and members of Coeur’s management.
At the meetings of the Special Committee on May 6, 2024 and of the Board on May 13, 2024, SilverCrest’s management provided
the Special Committee and the Board, respectively, with an update on due diligence and the Palmarejo site visit. Between May and June
2024, both SilverCrest and Coeur conducted initial financial, technical, operational, exploration and regulatory due diligence on the
other Party, during which time Ms. Hassan and Mr. Whelan had several calls to provide updates with respect to each Party’s
respective progress on due diligence and timing to receive an indicative proposal. In mid-June, 2024, reciprocal data room access was
granted by both SilverCrest and Coeur to facilitate more extensive due diligence between the Parties, and SilverCrest engaged Global
Resource Engineering Ltd. (“GRE”) to perform further technical due diligence on Coeur’s Rochester and Wharf
assets. In addition, Cormark was formally engaged by SilverCrest as co-financial advisor on July 15, 2024 to assist with the evaluation
of a potential transaction with Coeur.
Following the
engagement of these additional advisors, members of SilverCrest’s management team and consultants from GRE completed a site
visit to Coeur’s Rochester mine between July 16-17, 2024. Between July 17-19, 2024, members of Coeur’s management
and operational teams conducted their first site visit of the Company’s Las Chispas Operation. The site visits were followed
by several technical due diligence sessions by both Parties with the assistance of their respective technical advisors, with a
particular focus by SilverCrest on the Rochester operation of Coeur.
On July 24, 2024,
Messrs. Krebs and Fier held a telephonic meeting, during which both Parties indicated that their respective due diligence processes on
the other were progressing well, aided by the mutual site visits to Coeur’s Palmarejo and Rochester mines and
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to SilverCrest’s
Las Chispas Operation. Mr. Krebs indicated that subject to consultation with the Finance & Technical Committee of the Coeur Board,
Coeur would be prepared by the end of the following week to submit a preliminary non-binding proposal, which would include a period of
exclusivity during which each Party could conduct priority due diligence.
Evaluation
of Coeur and Party 1 Proposals
On August 2,
2024, Mr. Krebs discussed with Mr. Fier Coeur’s vision for the Combined Company and key components of a potential business combination
transaction between Coeur and SilverCrest, including consideration to be offered, governance matters, and conditions to the consummation
of the proposed transaction. Following this discussion, on August 2, 2024, Coeur delivered a non-binding proposal (the “Coeur
Initial Proposal”) to the Company, which provided for a proposed acquisition of all of the outstanding SilverCrest Shares pursuant
to a plan of arrangement under the BCBCA for consideration of Coeur Shares and a request for a five-week period for SilverCrest to negotiate
exclusively with Coeur.
Shortly before
receiving the Coeur Initial Proposal, Party 1’s financial advisor approached the Company’s financial advisor, Raymond James,
to discuss and request a material increase to the Company’s offer consideration in the Party 1 Proposal (the “Party 1
Counterproposal”), which would have resulted in significant dilution to SilverCrest Shareholders. Access to material due diligence
information in respect of Party 1 was also outstanding at the time of the Party 1 Counterproposal.
On August 6,
2024, the Special Committee met with the Company’s management and representatives of Cormark, Raymond James, Cassels and Paul,
Weiss to evaluate the Coeur Initial Proposal.
Cormark and Raymond
James provided their respective financial analyses and market assessment of Coeur’s proposal, including, but not limited to, an
overview of market conditions, an overview of Coeur’s financial performance, preliminary value analysis, strategic considerations,
and an analysis of the Coeur Initial Proposal against relative precedent transactions. Raymond James also provided a detailed comparison
of the relative benefits of a transaction with Coeur compared to a transaction with Party 1 based on the Party 1 Counterproposal. The
Special Committee, assisted by the Company’s financial and legal advisors, reviewed and evaluated the material terms, financial
analyses, and key benefits and risks of the proposed transaction with Coeur as set out in the Coeur Initial Proposal, and assessed such
transaction against the proposed transaction with Party 1 as set out in the Party 1 Proposal and the Party 1 Counterproposal, including
with respect to valuation, deal certainty, due diligence findings and the potential strategic opportunities available to, and financial
profile of, the Combined Company. In reviewing the relative benefits of the Coeur Initial Proposal and the Party 1 Counterproposal, the
Special Committee observed that the Coeur Initial Proposal would be accretive to SilverCrest Shareholders whereas the Party 1 Counterproposal
would be dilutive to SilverCrest Shareholders. The Special Committee also considered proposed revisions to the Coeur Initial Proposal
with the advice of legal counsel, including the exclusivity period, due diligence requirements, and voting support agreements.
On August 7,
2024, the Board met with the Company’s management and representatives of Raymond James, Cassels and Paul, Weiss to review the
Coeur Initial Proposal. The Board, assisted by the Company’s financial and legal advisors, reviewed and considered the
material terms, financial analyses, and key benefits and risks of the proposed transaction as set out in the Coeur Initial Proposal,
including proposed revisions to the Coeur Initial Proposal based on discussions with the Special Committee. The Board also evaluated
the proposed transaction with Coeur as set out in the Coeur Initial Proposal against the proposed transaction with Party 1 as set
out in the Party 1 Proposal and the Party 1 Counterproposal, in consultation with the Company’s financial and legal advisors.
The Special Committee confirmed to the Board that, following extensive negotiations, assessments and evaluations of the Coeur
Initial Proposal and the Party 1 Proposal, including the Company’s due diligence review of Coeur and Party 1, the
financial, strategic and social considerations and comparisons of the proposed transactions with Coeur and Party 1, and
considerations with respect to exclusivity, including consultation with Raymond James, Cormark, Cassels and Paul, Weiss, the Special
Committee unanimously determined that, for a number of reasons, including that the Coeur Initial Proposal would be accretive to
SilverCrest Shareholders whereas the Party 1 Counterproposal would be
dilutive to SilverCrest Shareholders, the Special Committee recommended that the Board approve the Company entering into the
non-binding proposal with Coeur, subject to the proposed revisions discussed between the Special Committee and its advisors.
Following receipt of the Special Committee’s unanimous recommendation, the Board’s review and consideration of the terms
of the Coeur Initial Proposal and comparisons of the proposed transactions with Coeur and Party 1, and advice from the financial
advisors and legal counsel of the Company, the Board unanimously approved the Company entering into the non-binding proposal with
Coeur, subject to the proposed revisions to the Coeur Initial Proposal recommended by the Special Committee.
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On August 8,
2024, the Company returned a revised non-binding proposal to Coeur reflecting the revisions as recommended by the Special Committee and
approved by the Board. Following a discussion between Messrs. Krebs and Fier regarding such revisions, on August 9, 2024, the Company
entered into the final non-binding proposal with Coeur (the “Coeur LOI”), which included an exchange ratio reflecting
an 18% premium for SilverCrest Shares based on the 20-day volume-weighted average prices of Coeur and SilverCrest on the NYSE and NYSE
American, respectively, as of August 8, 2024, as well as a binding exclusivity period for both Parties to negotiate exclusively
for a three-week period until August 30, 2024, which would be automatically extended for an additional two weeks (until September 13, 2024)
upon the reconfirmation by Coeur of the offer consideration in the Coeur LOI (the “Exclusivity Period”). The Coeur
LOI further set forth key terms of the proposed transaction recommended by the Special Committee, including, among other terms, consideration,
the transaction structure, governance of the Combined Company, conditions to consummating the proposed transaction, termination rights
as well as certain covenants of both Parties. The Coeur LOI, other than in respect of the Exclusivity Period, was non-binding, and the
entering into of the Arrangement Agreement was subject to each of SilverCrest and Coeur completing satisfactory due diligence, the directors
and officers of both companies entering into voting support agreements, the approval by the boards of directors of both companies, and
receipt by each of SilverCrest and Coeur of favourable fairness opinions from their respective financial advisors.
Immediately following
the execution of the Coeur LOI, SilverCrest notified Party 1 and its financial advisor that SilverCrest was terminating the Party 1 Proposal,
which termination was required under the terms of the Exclusivity Period. Each of the Company and Party 1 subsequently confirmed the
destruction of all information of the other party in accordance with the terms of their confidentiality agreement.
Negotiations
and Continuing Due Diligence with Coeur
In anticipation
of the negotiation of the Arrangement Agreement, Cassels delivered a memorandum on August 23, 2024 and met with the Special Committee
and the Board on August 27, 2024, with Paul, Weiss in attendance, to provide an additional overview of the role and responsibilities
of directors, including members of the Special Committee, in a change of control transaction, with specific reference to the proposed
acquisition of the Company by Coeur, and certain amendments were made to the mandate of the Special Committee to reflect the nature and
scope of the specific transaction being pursued with Coeur. At that time, the Special Committee determined that it was prudent for it
to also engage an independent financial advisor to opine on the fairness of the proposed transaction with Coeur. The Special Committee
engaged Scotiabank as its independent financial advisor on September 27, 2024 on a fixed-fee basis to provide such opinion.
In the course
of the Special Committee’s review and evaluation of the proposed transactions with Coeur and Party 1, between July and early October
2024, the Special Committee held 11 formal meetings and regularly consulted with management, Raymond James, Cormark, Cassels, Paul, Weiss,
and, following its engagement, Scotiabank. When SilverCrest management representatives were invited to attend formal meetings of the
Special Committee, at all of such meetings, the Special Committee also held in camera sessions without management present.
During the Exclusivity
Period, SilverCrest and Coeur, assisted by their respective financial and legal advisors, conducted in-depth due diligence investigations
of each other, including from a financial, accounting, tax, technical, operational, ESG, legal, social and human resources perspective.
These due diligence investigations included the exchange of written materials via electronic data rooms, numerous due diligence calls
with representatives from SilverCrest, Coeur and their respective legal, financial and technical advisors, as well as mine site visits.
These due diligence investigations continued throughout the period leading up to the signing of the Arrangement Agreement, involving
the review of extensive information files made available in Coeur’s data room, the engagement of numerous individuals in data room
reviews on behalf of SilverCrest, and comprehensive due diligence questions submitted by SilverCrest to Coeur.
Between August
13-20, 2024, SilverCrest hosted representatives of Coeur’s management, operations and exploration teams for a second site visit
at its Las Chispas Operation. On August 30, 2024, Mr. Fier had a discussion with Mr. Krebs with respect to both companies’ due
diligence to date and the anticipated timeline towards announcement of the proposed transaction.
On August 30,
2024, the Special Committee met with the Company’s management and representatives of Cormark, Raymond James, Cassels and Paul,
Weiss to receive an update on the Company’s in-depth financial and technical due diligence on Coeur, including site visits by the
Company and its technical advisors to Coeur’s Rochester and Palmarejo mines, with a focus on the ramp-up at Rochester, the Company’s
financial modelling for Coeur on an aggregate and asset basis, as well as the ongoing legal and regulatory due diligence
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on Palmarejo.
In addition, Cormark and Raymond James provided an update on the financial analyses of Coeur and the Combined Company since the date
of the Coeur LOI, and Cassels and Paul, Weiss provided an update on the legal due diligence of Coeur. Following extensive discussion,
consideration and assessment of the key benefits and risks of the proposed transaction with Coeur for the Company and its Shareholders,
as well as the merits and considerations around the extension of the Exclusivity Period, with the input from financial and legal advisors,
the Special Committee authorized the Company to confirm the extension of the Exclusivity Period until September 13, 2024, subject
to Coeur’s reconfirmation of the terms of the Coeur LOI. Later that day, Mr. Krebs re-confirmed the exclusivity extension by e-mail
to Mr. Fier.
On August 30,
2024, Coeur’s Canadian counsel, Goodmans, delivered an initial draft Arrangement Agreement to Cassels. Cassels and Paul, Weiss
prepared a key issues list and a mark up of the agreement for discussion with the senior management team of the Company and the Special
Committee.
On September
5, 2024, the Special Committee, the management team, Cormark, Raymond James, Cassels and Paul, Weiss reviewed and discussed the key issues
in the draft Arrangement Agreement and the Special Committee provided direction to counsel on a revised draft. Management and Cassels
also provided updates to the Special Committee in respect of the ongoing legal and technical due diligence of Coeur, including the technical
due diligence on Rochester. Following the Special Committee’s authorization, a revised draft of the Arrangement Agreement was delivered
to Coeur’s counsel on September 6, 2024.
Between September
3 and 13, 2024 following the confirmation of the Exclusivity Period, the Company and Coeur continued to progress their respective due
diligence efforts, including several due diligence sessions on both companies’ mineral reserves and resources, exploration and
human resources matters. In the second week of September, Cassels, Paul, Weiss and SMVR, the Company’s Mexican counsel, delivered
their preliminary legal due diligence reports on Coeur to the Company. During this time, senior management of Coeur and SilverCrest met
to discuss human resources and retention matters at both the SilverCrest corporate and operational levels.
On September
11, 2024, Mr. Krebs discussed with Mr. Fier Coeur’s desire to extend the Exclusivity Period until October 3, 2024 to facilitate
the completion of reciprocal due diligence and the negotiation of the Arrangement Agreement by the Parties, which request was formalized
in writing on September 12, 2024. On the same day, the Special Committee met with the Company’s management and representatives
of Cormark, Raymond James, Cassels and Paul, Weiss to consider Coeur’s request for the extension of the Exclusivity Period until
October 3, 2024 (the “Extended Exclusivity Period”). A formal amending agreement to the Coeur LOI (the “LOI
Amendment”) was proposed to be entered into between the Company and Coeur to confirm the Extended Exclusivity Period and reconfirm
all other terms of the Coeur LOI, should the Special Committee determine that the Extended Exclusivity Period was in the best interest
of the Company. The Special Committee, with the input and advice from the Company’s financial and legal advisors, considered and
evaluated the financial considerations and analysis for the proposed transaction with Coeur since the date of the Coeur LOI, key milestones
and risks in the timeline proposed by Coeur, both companies’ ongoing due diligence, the ongoing negotiation of the draft Arrangement
Agreement, the Company’s strategic review process and availability of alternatives, and the benefits and risks of the Extended
Exclusivity Period. Following in-depth discussion, the Special Committee unanimously determined that the Extended Exclusivity Period
was in the best interests of the Company and recommended that the Board approve the entering into of the LOI Amendment by the Company
with Coeur.
On September 13,
2024, the Board unanimously determined that the Extended Exclusivity Period and the entering into of the LOI Amendment were in the
best interests of the Company, and authorized the Company to enter into the LOI Amendment with Coeur. On the same day, Messrs. Krebs
and Fier discussed the Parties’ due diligence processes, ongoing negotiation of definitive documentation, as well as
the offer consideration, including that the offer consideration will be discussed again by the Parties prior to entering into the
Arrangement Agreement. Following the Board’s approval, the Company entered into the LOI Amendment.
Later on September 13, 2024,
a revised draft Arrangement Agreement was delivered by Goodmans. Cassels and Paul, Weiss reviewed and discussed the key issues with the
senior management team of the Company and the Special Committee. Between September 13, 2024 and the expiry of the Extended
Exclusivity Period on October 3, 2024, Cassels and Paul, Weiss continued to negotiate the Arrangement Agreement and related documentation
with Coeur’s legal counsel through the exchange of drafts and various conference calls. The Special Committee met with the Company’s
management and representatives of Cassels, Paul, Weiss, Cormark and Raymond James to review key issues and open items on several occasions,
including with respect to negotiation positions and strategies in respect of material provisions in the Arrangement Agreement relating
to, among other things, termination rights, termination fees, conditions precedent, non-solicitation restrictions and treatment of equity
compensation securities. The Special
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Committee provided directions to the Company’s management, with the advice of legal counsel,
to negotiate the open issues with Coeur within the parameters discussed.
During this period,
SilverCrest and Coeur continued to advance and complete their respective technical, operational, financial, tax, regulatory and legal
due diligence, including several due diligence sessions in respect of each Party, with the assistance and input from their respective
technical, financial and legal advisors. On September 24 and 25, 2024, SilverCrest hosted certain members of Coeur’s executive
management and board of directors for a third site visit at the Las Chispas Operation. During the last week of September 2024, Cassels,
Paul, Weiss and SMVR delivered supplemental Canadian, U.S. and Mexican legal due diligence reports, respectively, to the Company.
On October 1
and 2, 2024, Messrs. Krebs and Fier had discussions and exchanged correspondence on the proposed consideration under the Arrangement,
taking into consideration the performance of Coeur Shares since the announcement by Coeur of the achievement of key milestones at its
expanded Rochester mine on September 12, 2024. The Special Committee met with the Company’s management and representatives of Cormark,
Raymond James, Scotiabank, Cassels and Paul, Weiss to discuss the negotiation of the premium for the consideration and other open issues
relating to the Arrangement. Following extensive discussion, in consultation with the Company’s financial and legal advisors, Mr.
John Wright, the Chair of the Special Committee and the Board, together with Mr. Fier, met with Mr. J. Kenneth Thompson, the lead independent
director of Coeur and Mr. Krebs, to negotiate the proposed premium of the consideration under the Arrangement as well as other open issues
relating to the Arrangement. The meeting was concluded with an alignment by both Parties that the proposed consideration under the Arrangement
would reflect an implied 18% premium for SilverCrest Shares based on the 20-day volume weighted average prices of Coeur and SilverCrest
as of the date of the Arrangement Agreement, which was consistent with the premium implied by the proposed consideration set forth in
the Coeur LOI.
On October 3,
2024, Coeur and SilverCrest agreed to the Exchange Ratio of 1.6022 Coeur Shares for each outstanding SilverCrest Share, representing
an implied 18% premium for SilverCrest Shares based on the 20-day volume-weighted average prices of Coeur and SilverCrest on the NYSE
and NYSE American, respectively, as of the close of business on October 3, 2024.
Board and
Special Committee Deliberations and Approval
The Board and
Special Committee met on October 3, 2024 with representatives of Cassels and Paul, Weiss, and at relevant times, Cormark, Raymond James
and Scotiabank, present. At the Board meeting, management of the Company presented its analysis and evaluation of the Arrangement, a
detailed overview of management’s due diligence investigations on Coeur, including from an operational, technical, legal, ESG,
human resources, financial, tax and accounting perspective, and a review of the Company’s strategic review process and opportunities
landscape. Raymond James provided an overview of the Company’s strategic review process, including the discussions and opportunities
in which the Company was engaged prior to entering into the Coeur LOI, and the likelihood of those discussions leading to a proposal.
Cassels provided an overview of the material provisions of the Arrangement Agreement and related documentation, regulatory approvals
required, considerations under MI 61-101, legal due diligence on Coeur, as well as the anticipated transaction timeline.
At that meeting
of the Board, Cormark provided an overview of its approach to financial analysis, discussed the scope of its work, and presented its
financial analysis of the proposed transaction. Following discussion, Cormark orally delivered its opinion (subsequently
confirmed in writing) that, as of the date of such opinion and based upon and subject to the assumptions, limitations and
qualifications described to the Board, the Consideration is fair, from a financial point of view, to Shareholders. Thereafter,
Raymond James provided an overview of its approach to financial analysis, discussed the scope of its work, and presented its
financial analysis of the proposed transaction. Following discussion, Raymond James orally delivered its opinion (subsequently
confirmed in writing) that, as of the date of such opinion and based upon and subject to the assumptions, limitations and
qualifications described to the Board, the Consideration is fair, from a financial point of view, to Shareholders. The Board Meeting
was then adjourned in order to hold the meeting of the Special Committee.
At the Special
Committee meeting, Scotiabank provided an overview of its approach to financial analysis, discussed the scope of its work, and presented
its financial analysis of the proposed transaction. Following discussion, Scotiabank orally delivered its opinion (subsequently confirmed
in writing) that, as of the date of such opinion and based upon and subject to the assumptions, limitations and qualifications described
to the Special Committee, the Consideration is fair, from a financial point of view, to Shareholders.
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After discussion
and careful deliberation and consultation with its legal and financial advisors, during which the Special Committee considered both the
expected benefits and risks of the Arrangement, the Cormark Fairness Opinion and Raymond James Fairness Opinion that had been provided
to members of the Special Committee in their capacity as directors of SilverCrest, the Scotiabank Fairness Opinion as well as the matters
more fully described under “The Arrangement – Reasons for the Arrangement”, the Special Committee completed
its deliberations in camera and unanimously determined that the Arrangement is in the best interests of the Company (considering
the interests of all stakeholders) and is fair and reasonable to Shareholders, and unanimously determined to recommend that the Board
approve the Arrangement and the entering into of Arrangement Agreement by the Company and recommend that Securityholders vote FOR
the Arrangement Resolution.
Immediately following
the meeting of the Special Committee, the Board reconvened its meeting to receive the recommendation of the Special Committee. After
discussion and careful deliberation and consultation with its legal and financial advisors, during which the Board considered the unanimous
recommendation of the Special Committee, the Cormark Fairness Opinion and the Raymond James Fairness Opinion, as well as both the expected
benefits and risks of the Arrangement, including the matters more fully described under “The Arrangement – Reasons for
the Arrangement”, the Board unanimously determined that the Arrangement is in the best interests of the Company (considering
the interests of all stakeholders) and is fair and reasonable to Shareholders, and unanimously approved the Arrangement and the entering
into of the Arrangement Agreement by the Company and resolved to recommend that Securityholders vote FOR the Arrangement
Resolution.
Following the
meeting of the Board, SilverCrest and Coeur, assisted by their respective legal counsel, finalized the terms of the Arrangement Agreement
and related documentation. The Arrangement Agreement, SilverCrest Voting Agreements and Coeur Voting Agreements were then executed during
the evening of October 3, 2024, and SilverCrest and Coeur issued a joint press release announcing the Arrangement prior to the opening
of the TSX and NYSE on October 4, 2024.
Recommendation
of the Special Committee
Having thoroughly
reviewed and carefully considered the proposed Arrangement and alternatives to the Arrangement, including the potential for a more favourable
transaction with a third party and the prospect of proceeding independently to pursue the Company’s current business plan, and
having consulted with its financial and legal advisors, and having considered the Fairness Opinions, the Special Committee unanimously
determined that the Arrangement is fair and reasonable to the Shareholders, and the Arrangement and entering into the Arrangement Agreement
are in the best interests of the Company. The Special Committee unanimously recommended that the Board approve the Arrangement Agreement
and that the Board recommend that Securityholders vote FOR the Arrangement Resolution.
Recommendation
of the Board
Based on its
considerations, investigations and deliberations, including consultation with its financial and legal advisors, the unanimous
recommendation of the Special Committee, the Cormark Fairness Opinion and Raymond James Fairness Opinion, the Board has unanimously
determined that the Arrangement is in the best interests of the Company. Accordingly, the Board unanimously approved
the Arrangement and the entering into of the Arrangement Agreement and unanimously recommends that the Securityholders vote FOR
the Arrangement Resolution. Each director and officer of the Company intends to vote all of such director’s and
officer’s SilverCrest Shares and SilverCrest Options FOR the Arrangement Resolution.
In forming its
recommendation, the Special Committee and the Board considered a number of factors, including, without limitation, the factors listed
below under “Reasons for the Arrangement”. The Board based its recommendation upon the totality of the information
presented to and considered by it in light of the knowledge of the Board members of the business, financial condition and prospects of
the Company and after taking into account the Fairness Opinions and the advice of the Company’s legal and other advisors and the
advice and input of management of the Company.
Reasons for the
Arrangement
At a meeting of the Board held on
October 3, 2024, the Board evaluated the Arrangement in the context of the Company’s available strategic alternatives and, based
on a thorough review of these alternatives, the Board unanimously:
| · | determined
that the Arrangement is in the best interests of the Company; |
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| · | resolved
to recommend that Securityholders vote FOR the Arrangement Resolution; and |
| · | approved
the Arrangement Agreement and the Arrangement. |
In evaluating the Arrangement and
in making its recommendations, the Board and the Special Committee gave careful consideration to the current and expected future position
of the business of SilverCrest and all terms of the draft Arrangement Agreement, including the conditions precedent, representations
and warranties and deal protections. The Board reviewed and considered a significant amount of information and considered a number of
factors relating to the Arrangement with the benefit of advice from the Special Committee, and the financial and legal advisors of the
Special Committee and the Board and input from the senior management team. The following is a summary of the principal reasons for
the unanimous recommendation of the Special Committee and the Board that Securityholders vote FOR the Arrangement Resolution:
| · | Significant
Premium. The Consideration represents an implied value of US$11.34 per SilverCrest Share,
being an 18% premium based on the 20-day volume-weighted average prices of the Coeur Shares
and SilverCrest Shares, each as at October 3, 2024 on the NYSE and NYSE American, respectively,
and a 22% premium to the October 3, 2024 closing price of SilverCrest Shares on the NYSE
American, being the last trading day prior to the announcement of the Arrangement. This also
represents an all-time high in the value of SilverCrest Shares for Shareholders. |
| · | Meaningful
Exposure to Diverse Asset Portfolio. Current Shareholders will maintain exposure to the
Company’s high-grade, low-cost and high-margin Las Chispas Operation and will gain
exposure to Coeur’s high quality and diversified portfolio consisting of four robust
operating mines in the U.S. and Mexico and an exploration property in Canada, with further
potential upside from the district-scale exploration potential of the Combined Company and
organic mineral reserve growth. Current Shareholders will hold approximately 37% of the issued
and outstanding shares of the Combined Company upon completion of the Arrangement, based
on the number of securities of Coeur and SilverCrest issued and outstanding as of October 3, 2024. |
| · | Creation
of a Leading Global Silver Company. The addition of Las Chispas to Coeur’s growing
silver production from its recently expanded Rochester mine in Nevada and its Palmarejo underground
mine in northern Mexico has the potential to generate significant 2025 silver production
of approximately 21 million ounces from five North American operations, with approximately
56% of revenue generated from U.S.-based mines and approximately 40% of revenue from silver.
In addition to the significant silver production, it is anticipated that the Combined Company
can produce approximately 432,000 ounces of gold in 2025. |
| · | Strong
Cash Flow and Deleveraging of Combined Company. The Combined Company is expected to generate
approximately US$700 million of EBITDA4 and US$350 million of free cash flow3
in 2025 at lower overall costs and higher overall margins for Coeur. The Combined Company
will also have more robust cash flow with the benefit of multiple producing mines in a diversified
portfolio. The strong cash flow profile of the Combined Company will be augmented by SilverCrest’s
strong balance sheet and no debt which are expected to result in an immediate 40% reduction
in the Combined Company’s leverage ratio upon closing of the Arrangement. |
| · | Strategic
Review Process and Value Maximization. The Arrangement with Coeur is the culmination
of a comprehensive strategic review process that was initiated following Las Chispas achieving
commercial production in late 2022, which process was overseen by the Board initially, and
subsequently, the Special Committee, with the assistance of the Company’s financial
advisors (including Raymond James initially in late 2022 and the addition of Cormark in 2024).
During this process, the Company, through its financial advisors, canvassed numerous other
potential parties to determine market interest in a transaction involving, and explore various
strategic opportunities available to, SilverCrest (including maintaining status quo, asset
purchases, merger of equals, acquisitions and a sale of the Company). This process resulted
in the evaluation of over 25 potential strategic opportunities, the execution of more than
15 confidentiality agreements, substantive reviews and site visits of more than 10 mineral
properties and multiple site visits hosted at Las Chispas. See “The Arrangement
– Background to the Arrangement” for more details on the strategic review
process undertaken by the Company. After consultation on the proposed Arrangement with legal
and financial advisors, and after review of the current and prospective business climate
in the precious metals mining industry and other strategic opportunities reasonably available
to SilverCrest, including |
4 This
is a non-GAAP performance measure. See “Management Information Circular – Non-GAAP Financial Performance Measures”.
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| | | continuing
as an independent entity, potential acquisitions and sales, in each case taking into account
the potential benefits, risks and uncertainties associated with those other opportunities,
the Special Committee and the Board believe the Arrangement represents SilverCrest’s
best prospect for maximizing Shareholder value. |
| · | Asset
Diversification and Elimination of Single Asset Risk. The business, operations, assets,
financial condition, operating results and prospects of SilverCrest are subject to significant
uncertainty, including, but not limited to, risks associated with SilverCrest’s dependency
on the Las Chispas Operation for its future operating revenue, permitting and regulatory
approvals, exploration and development risks and commodity price and inflation risks. The
Combined Company will be better positioned to pursue a growth and value maximizing strategy
as compared with SilverCrest on a standalone basis, as a result of the Combined Company’s
larger market capitalization, asset and geographical diversification, elimination of single
asset risk, technical expertise, greater trading liquidity, enhanced access to capital over
the long term and the likelihood of increased investor interest and access to business development
opportunities due to the Combined Company’s larger market presence. |
| · | Proven
Leadership Team. Following the Arrangement, two of the current directors of SilverCrest,
Messrs. N. Eric Fier and Pierre Beaudoin, will join the board of the Combined Company. Management
of the Combined Company will feature proven and experienced mining and business leaders at
both the board and executive management levels, along with diverse, high performing teams
at the regional and operating sites with a proven track record of maximizing value by delivering
long-life and profitable silver and gold mining operations. The Combined Company will continue
its commitment to ESG with a specific focus on water usage, emissions, community and workforce
development, and leading governance practices. |
| · | Fairness
Opinions. The Special Committee received a fairness opinion from Scotiabank, and the
Board received a fairness opinion from each of Cormark and Raymond James, all dated October
3, 2024 to the effect that the Consideration to be received by the Shareholders pursuant
to the Arrangement is fair, from a financial point of view, to the Shareholders, based upon
and subject to various assumptions, limitations and qualifications set forth, respectively,
in each such opinion, as more fully described under “The Arrangement – Fairness
Opinions”. |
| · | Support
of Directors and Officers. The boards of directors of both SilverCrest and Coeur have
unanimously recommended support for the Arrangement. Additionally, the directors and senior
officers of SilverCrest and Coeur have entered into voting and support agreements pursuant
to which they have agreed, among other things, to vote in
favour of the Arrangement Resolution at the Meeting and in favour of the amendment of Coeur’s charter and issuance of Coeur Shares
as consideration under the Arrangement at Coeur’s stockholder meeting, as applicable. |
| · | Negotiated
Transaction. The Arrangement Agreement is the result of a comprehensive negotiation process
with respect to the key elements of the Arrangement Agreement and Plan of Arrangement, which
includes terms and conditions that are reasonable in the judgment of the Special Committee
and the Board. |
| · | Other
Factors. The Special Committee and the Board also carefully considered the Arrangement
with reference to current economics, industry and market trends affecting each of SilverCrest
and Coeur in the precious metals mining industry, information concerning mineral reserves
and mineral resources, business, operations, properties, assets, financial condition, operating
results and prospects of each of SilverCrest and Coeur, taking into account the results of
SilverCrest’s due diligence review of Coeur and its properties. |
In making its
determinations and recommendations, the Special Committee and the Board also observed that a number of procedural and legal safeguards
were in place and are present to protect the interests of the Company, the Securityholders and other SilverCrest stakeholders. The procedural
and legal safeguards include, among others:
| · | Ability
to Respond to Unsolicited Superior Proposals. Subject to the terms of the Arrangement
Agreement, the Board will remain able to respond to any unsolicited bona fide written
proposal that, having regard to all of its terms and conditions, if consummated in accordance
with its terms, constitutes or would reasonably be expected to constitute or result in a
Company Superior Proposal (as such term is defined in the Arrangement Agreement), provided
that the Company has not materially breached its non-solicitation covenants under the Arrangement
Agreement. |
| · | Reasonable
Break Fee. The amount of the Company Termination Payment, being $60 million, payable
under certain circumstances, is within the range of termination fees that are considered
reasonable for a transaction of the nature and size |
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| | | of
the Arrangement and should not, in the view of the Board, preclude a third party from potentially
making a Company Superior Proposal. |
| · | Fairness
of the Conditions. The Arrangement Agreement provides for certain conditions with respect
to completion of the Arrangement, which conditions are not unduly onerous or outside market
practice and could reasonably be expected to be satisfied in the judgment of the Special
Committee and the Board. |
| · | Securityholder
Approval. The Arrangement Resolution must be approved by at least (i) 66⅔% of the
votes cast on such resolution by Shareholders present in person or represented by proxy and
entitled to vote at the Meeting, (ii) 66⅔% of the votes cast on such resolution by
Securityholders, voting together as a single class, present in person or represented by proxy
and entitled to vote at the Meeting, and (iii) a simple majority of the votes cast on such
resolution by Shareholders present in person or represented by proxy and entitled to vote
at the Meeting, excluding the Excluded Shares for the purposes of MI 61-101. |
| · | Court
and Regulatory Approvals. The Plan of Arrangement must be approved by the Court, which
will consider, among other things, the substantive and procedural fairness and reasonableness
of the Plan of Arrangement to Securityholders. The Arrangement Agreement also contains a
condition precedent that all regulatory approvals shall be obtained prior to closing. |
| · | Dissent
Rights. The terms of the Plan of Arrangement provide that Registered Shareholders as
at the close of business on the Record Date who oppose the Arrangement may, upon compliance
with certain conditions, exercise dissent rights and, if ultimately successful, receive fair
value for their SilverCrest Shares (as described in the Plan of Arrangement). See “The
Arrangement — Dissenting Shareholders’ Rights” in this Circular for
detailed information regarding the dissent rights of Shareholders in connection with the
Arrangement. |
The Board and the Special Committee also
considered a number of potential issues and risks related to the Arrangement and the Arrangement Agreement, including, among others:
| · | the
risks to SilverCrest and the Securityholders if the Arrangement is not completed, including
the costs to the Company in pursuing the Arrangement and the diversion of the Company’s
management from the conduct of SilverCrest’s business in the ordinary course; |
| · | the
terms of the Arrangement Agreement in respect of restricting the Company from soliciting
third parties to make an Acquisition Proposal (as such term is defined in the Arrangement
Agreement) and the specific requirements regarding what constitutes a Company Superior Proposal; |
| · | the
terms of the Arrangement Agreement that require the Company to conduct its business in the
ordinary course and prevent the Company from taking certain specified actions, which may
delay or prevent SilverCrest from taking certain actions to advance its business pending
consummation of the Arrangement; |
| · | the
fact that, following the Arrangement, SilverCrest will no longer exist as an independent
public company and the SilverCrest Shares will be delisted from the TSX and NYSE American; |
| · | the
risk that changes in Law or regulation could adversely impact the expected benefits of the
Arrangement to SilverCrest, Securityholders and other stakeholders; |
| · | the
risk that the Coeur Shares to be issued as consideration are based on a fixed Exchange Ratio
and will not be adjusted based on fluctuations in the market value of SilverCrest Shares
or Coeur Shares; |
| · | the
risk that regulatory approvals may not be obtained in a timely manner and extend the restrictions
on the conduct of SilverCrest’s business prior to the completion of the Arrangement,
which could impact the Company’s ability to engage in business opportunities that may
arise pending completion of the Arrangement; |
| · | the
Company Termination Payment payable to Coeur, including if SilverCrest enters into an agreement
in respect of a Company Superior Proposal to acquire SilverCrest, or that SilverCrest could
be required to pay the Expense Reimbursement; |
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| · | the
conditions to Coeur’s obligations to complete the Arrangement; |
| · | the
right of Coeur to terminate the Arrangement Agreement under certain circumstances; |
| · | the
risks inherent in integrating the operations of SilverCrest into Coeur, including that expected
synergies may not be realized, and that successful integration will require the dedication
of significant management resources, which will temporarily detract attention from the day-to-day
businesses of the Combined Company; and |
| · | the
shares of the Combined Company to be received by Shareholders upon completion of the Arrangement
will have different rights from SilverCrest Shares. |
The above discussion
of the information and factors considered by the Board and the Special Committee is not intended to be exhaustive, but is believed by
the Board and the Special Committee to include the material factors considered by the Board and the Special Committee in its respective
assessment of the Arrangement. In view of the wide variety of factors considered by the Board and the Special Committee in connection
with its assessment of the Arrangement and the complexity of such matters, the Board and the Special Committee did not consider it practical,
nor did it attempt, to quantify, rank or otherwise assign relative weights to the foregoing factors that it considered in reaching its
decision. In addition, in considering the factors described above, individual members of the Board and the Special Committee may have
given different weights to various factors and may have applied different analyses to each of the material factors considered by the
Board and the Special Committee.
The Board’s
and the Special Committee’s reasons for recommending the Arrangement include certain assumptions relating to forward-looking information,
and such information and assumptions are subject to various risks. This information should be read in light of the factors described
under the section entitled “Management Information Circular – Forward-Looking Information”, under the heading
“Risk Factors” and in Appendix H, “Information Concerning Coeur – Risk Factors”.
Fairness Opinions
In connection
with the evaluation of the Arrangement, the Special Committee received and considered the Scotiabank Fairness Opinion, and the Board
received and considered the Cormark Fairness Opinion and Raymond James Fairness Opinion.
The full text
of the Fairness Opinions, which sets forth assumptions made, procedures followed, information reviewed, matters considered, and limitations
on the scope of the review undertaken by Scotiabank, Cormark and Raymond James in connection with their respective Fairness Opinions,
are attached in Appendix E, Appendix F and Appendix G, respectively. This summary is qualified in its entirety by reference to the full
text of such Fairness Opinions. Scotiabank, Cormark and Raymond James provided their opinions solely for the information and assistance
of the Special Committee and the Board, as applicable, in connection with their consideration of the Arrangement and except for the inclusion
of the Fairness Opinions in their entirety and a summary thereof in this Circular, the Fairness Opinions are not to be summarized, circulated,
reproduced, publicized, disseminated, quoted from or referred to (in whole or in part) or used or relied upon by any party without the
respective express prior written consent of Scotiabank, Cormark or Raymond James. The Fairness Opinions were not intended to be and are
not a recommendation to the Special Committee or the Board as to whether it should approve the Arrangement Agreement or the Arrangement,
nor are they a recommendation to any Securityholder as to how they should vote or act on any matter relating to the Arrangement or any
other matter or an opinion concerning the trading price or value of any securities of the Company following the announcement or completion
of the Arrangement. Securityholders are urged to read the Fairness Opinions in their entirety.
Scotiabank
Fairness Opinion
Scotiabank was
formally engaged as an independent financial advisor to the Special Committee, pursuant to an engagement letter dated September 27, 2024,
to provide the Special Committee with certain financial advisory services in connection with the Arrangement, including, among other
things, the provision of an opinion regarding the fairness, from a financial point of view, of the Consideration to be received by the
Shareholders pursuant to the Arrangement. Pursuant to the terms of its engagement letter with the Company, Scotiabank is to be paid a
fixed fee for the delivery of the Scotiabank Fairness Opinion. The Company has also agreed to reimburse Scotiabank for reasonable out-of-pocket
expenses and to indemnify Scotiabank against certain liabilities.
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On October 3,
2024, at the meeting of the Special Committee held to consider the Arrangement, Scotiabank rendered an oral opinion, which was subsequently
confirmed in writing, to the Special Committee to the effect that, as of October 3, 2024, and based on and subject to the assumptions,
limitations and qualifications set forth therein and such other matters as Scotiabank considered relevant, the Consideration to be received
by the Shareholders pursuant to the Arrangement is fair, from a financial point of view, to the Shareholders.
In connection
with the evaluation of the Arrangement, the Special Committee considered, among other things, the Scotiabank Fairness Opinion and the
Board considered the advice and financial analyses provided by Cormark and Raymond James referred to below as well as the Fairness Opinions.
As described under “The Arrangement – Reasons for the Arrangement”, the Fairness Opinions were only one of many
factors considered by the Special Committee and the Board in evaluating the Arrangement and should not be viewed as determinative of
the views of the Special Committee or the Board with respect to the Arrangement or the Consideration to be received by Shareholders pursuant
to the Arrangement. In assessing the Scotiabank Fairness Opinion, the Special Committee also considered and assessed the independence
of Scotiabank.
In support of
the Scotiabank Fairness Opinion, Scotiabank performed certain financial analyses to evaluate the Consideration being offered in connection
with the Arrangement, which are more fully described the Scotiabank Fairness Opinion.
The full text of the
Scotiabank Fairness Opinion, which sets forth assumptions made, procedures followed, information reviewed, matters considered, and limitations
on the scope of the review undertaken by Scotiabank in connection with the Scotiabank Fairness Opinion, is attached in Appendix E.
Cormark
Fairness Opinion
Cormark was formally
engaged by the Company as a financial advisor, pursuant to an agreement dated July 15, 2024, to provide the Company with various advisory
services in connection with the Arrangement including, among other things, the provision of the Cormark Fairness Opinion. Pursuant to
the terms of its agreement with the Company, Cormark is to be paid fees for its services as financial advisor, including a fixed fee
for the delivery of the Cormark Fairness Opinion. Cormark will also receive an advisory fee which is contingent upon the successful completion
of the Arrangement. The Company has also agreed to reimburse Cormark for reasonable out-of-pocket expenses and to indemnify Cormark against
certain liabilities.
On October 3,
2024, at the meeting of the Board held to consider the Arrangement, Cormark rendered an oral opinion, confirmed by delivery of a written
opinion dated October 3, 2024 to the Board to the effect that, as of that date and based on and subject to the assumptions, limitations
and qualifications set forth therein, the Consideration to be received by the Shareholders pursuant to the Arrangement is fair from a
financial point of view to the Shareholders.
The full text
of the Cormark Fairness Opinion, which sets forth assumptions made, procedures followed, information reviewed, matters considered, and
limitations on the scope of the review undertaken by Cormark in connection with the Cormark Fairness Opinion, is attached in Appendix
F. The Cormark Fairness Opinion represents the opinion of Cormark and the form and content of the Cormark Fairness Opinion have been
approved for release by a committee of senior Cormark investment banking professionals, each of whom is experienced in merger, acquisition,
divestiture, valuation, fairness opinion and capital markets matters.
Raymond
James Fairness Opinion
Raymond James
was formally engaged by the Company as a financial advisor, pursuant to an agreement dated June 6, 2024, to provide the Company with
various advisory services in connection with any potential transaction including, among other things, the provision of the Raymond James
Fairness Opinion. Pursuant to the terms of its agreement with the Company, Raymond James is to be paid fees for its services as financial
advisor, including a fixed fee for the delivery of the Raymond James Fairness Opinion. Raymond James will also receive a transaction
fee which is contingent upon the successful completion of the Arrangement. The Company has also agreed to reimburse Raymond James for
reasonable out-of-pocket expenses and to indemnify Raymond James against certain liabilities.
On October 3,
2024, at the meeting of the Board held to consider the Arrangement, Raymond James rendered an oral opinion, confirmed by delivery of
a written opinion dated October 3, 2024 to the Board to the effect that, as of that date and based on and subject to the assumptions,
limitations and qualifications set forth therein, the Consideration to be received by the Shareholders pursuant to the Arrangement is
fair, from a financial point of view, to the Shareholders.
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The full text
of the Raymond James Fairness Opinion, which sets forth assumptions made, procedures followed, information reviewed, matters considered,
and limitations on the scope of the review undertaken by Raymond James in connection with the Raymond James Fairness Opinion, is attached
in Appendix G. The Raymond James Fairness Opinion represents the opinion of Raymond James and the form and content of the Raymond
James Fairness Opinion have been approved for release by a committee of managing directors of Raymond James who are collectively experienced
in providing valuations and fairness opinions for mergers and acquisitions as well as providing capital markets advice.
Voting and Support
Agreements
SilverCrest
Voting Agreements
The directors and
senior officers of SilverCrest have entered into the SilverCrest Voting Agreements with Coeur pursuant to which they have agreed to vote
FOR the Arrangement Resolution. As of the Record Date, the directors and senior officers of SilverCrest hold a total of
3,441,935 SilverCrest Shares and 1,680,436 SilverCrest Options, representing approximately 2.3% of the outstanding SilverCrest Shares
and 3.4% of the outstanding SilverCrest Shares and SilverCrest Options collectively.
The directors
and senior officers of SilverCrest have agreed, subject to the terms of the SilverCrest Voting Agreements, among other things:
| (a) | at
any meeting of Securityholders to be held to consider the Arrangement (including the Meeting)
or any of the other transactions contemplated by the Arrangement Agreement to vote their
SilverCrest Shares and SilverCrest Options entitled to be voted in favour of the Arrangement
Resolution and any other matter necessary for the consummation of the Arrangement, and against
any resolution, action, proposal, transaction or agreement proposed by any other Person,
that would reasonably be expected to adversely affect or reduce the likelihood of the successful
completion of the Arrangement, or delay, frustrate or interfere with the completion of the
Arrangement; |
| (b) | no
later than ten (10) days prior to the date of the Meeting, with respect to all of their SilverCrest
Shares and SilverCrest Options, to deliver or cause to be delivered, a duly executed proxy
or VIF causing their SilverCrest Shares and SilverCrest Options to be voted in favour of
the Arrangement Resolution, and such proxy or proxies or voting instructions shall not be
revoked, withdrawn or modified without the prior written consent of Coeur; |
| (c) | not
to exercise any Dissent Rights in connection with the Arrangement and not exercise any shareholder
rights or remedies available at common law or pursuant to securities or corporate Laws to
delay or prevent the Arrangement; and |
| (d) | except
as contemplated by the Arrangement Agreement or upon the settlement of awards or other securities
of the Company or the exercise of other rights to purchase SilverCrest Shares, including
any purchases of SilverCrest Shares under any of the Company Incentive Awards, not to, directly
or indirectly (a) sell, transfer, gift, assign, grant a participation interest in, option,
pledge, hypothecate, grant a security or voting interest in or otherwise convey or encumber
(each, a “Transfer”), or enter into any agreement, option or other arrangement
(including any profit sharing arrangement, forward sale or other monetization arrangement)
with respect to the Transfer of any of its SilverCrest securities to any person without Coeur’s
prior written consent, other than pursuant to the Arrangement Agreement or to the extent
the proceeds of such sale or disposition are paid towards (or otherwise set-off from) the
exercise price and/or tax liability incurred as a result of the exercise and/or settlement
of a Company Incentive Award. |
The SilverCrest
Voting Agreements automatically terminate upon the earliest of: (a) the Effective Time; (b) the date the Arrangement Agreement is terminated
in accordance with its terms; (c) the date on which a Company Change in Recommendation is undertaken by the Board; and (d) the completion
of the Meeting.
The foregoing
is a summary of the material terms of the SilverCrest Voting Agreements and is subject to, and qualified in its entirety by, the full
text of the SilverCrest Voting Agreements, the form of which is appended to the Arrangement Agreement and filed under SilverCrest’s
issuer profiles on SEDAR+ at www.sedarplus.ca and on EDGAR at www.sec.gov.
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Coeur Voting
Agreements
The directors
and senior officers of Coeur have entered into the Coeur Voting Agreements with SilverCrest pursuant to which they have agreed to vote
in favour of the Coeur Charter Amendment and Coeur Stock Issuance. As of the record date of the Coeur Meeting, such directors and senior
officers of Coeur hold a total of 6,045,787 Coeur Shares, representing approximately 1.5% of the outstanding Coeur Shares.
The directors
and senior officers of Coeur have agreed, subject to the terms of the Coeur Voting Agreements, among other things:
| (a) | at
any meeting of Coeur Stockholders to be held to consider the Coeur Charter Amendment and
Coeur Stock Issuance (including the Coeur Meeting) or any of the other transactions contemplated
by the Arrangement Agreement to vote their Coeur Shares entitled to be voted in favour of
the Coeur Charter Amendment and Coeur Stock Issuance and any other matter necessary for the
consummation of the Arrangement, and against any resolution, action, proposal, transaction
or agreement proposed by any other Person, that would reasonably be expected
to adversely affect or reduce the likelihood of the successful completion of the Arrangement, or delay, frustrate or interfere with the
completion of the Arrangement; |
| (b) | no
later than ten (10) days prior to the date of the Coeur Meeting, with respect to all of their
Coeur Shares, to deliver or cause to be delivered, a duly executed proxy or VIF causing their
Coeur Shares to be voted in favour of the Coeur Charter Amendment and Coeur Stock Issuance,
and such proxy or proxies or voting instructions shall not be revoked, withdrawn or modified
without the prior written consent of SilverCrest; |
| (c) | not
to exercise any rights to dissent or rights of appraisal provided under any Laws or otherwise
in connection with the Arrangement and not exercise any shareholder rights or remedies available
at common law or pursuant to securities or corporate Laws to delay or prevent the Arrangement;
and |
| (d) | except
as contemplated by the Arrangement Agreement or upon the settlement of awards or other securities
of Coeur or the exercise of other rights to purchase Coeur Shares, including any purchases
of Coeur Shares under any of the Coeur Incentive Awards, not to, directly or indirectly Transfer,
or enter into any agreement, option or other arrangement (including any profit sharing arrangement,
forward sale or other monetization arrangement) with respect to the Transfer of any of its
Coeur securities to any person without SilverCrest’s prior written consent, other than
pursuant to the Arrangement Agreement, or to the extent the proceeds of such sale or disposition
are paid towards (or otherwise set-off from) the exercise price and/or tax liability incurred
as a result of the exercise and/or settlement of a Coeur Incentive Award. |
The Coeur Voting
Agreements automatically terminate upon the earliest of: (a) the Effective Time; (b) the date the Arrangement Agreement is terminated
in accordance with its terms; (c) the date on which a Coeur Change in Recommendation is undertaken by the Coeur Board; and (d) the completion
of the Coeur Meeting.
The foregoing
is a summary of the material terms of the Coeur Voting Agreements and is subject to, and qualified in its entirety by, the full text
of the Coeur Voting Agreements, the form of which is appended to the Arrangement Agreement and filed under SilverCrest’s issuer
profiles on SEDAR+ at www.sedarplus.ca and on EDGAR at www.sec.gov.
Plan of Arrangement
The following
description is a summary of the Plan of Arrangement and is qualified in its entirety by reference to the full text of the Plan of Arrangement,
which is attached as Appendix B to this Circular.
At the Effective
Time, the following principal steps shall occur and shall be deemed to occur sequentially in the following order, without any further
authorization, act or formality:
| (a) | Transfer
of Bullion: All Bullion beneficially owned by the Company shall be, and shall be deemed
to be, transferred to Company Canadian Sub pursuant to Section 85 of the Tax Act and, in
consideration therefor, Company Canadian Sub shall (i) allot and issue one (1) Company Canadian
Sub Share to Company, and (ii) issue a U.S. dollar denominated, non-interest bearing, demand
promissory note in favour of the Company with a principal amount equal to the Company’s
cost amount of the Bullion (for the purpose of the Tax Act), and the Company and Company
Canadian Sub shall file a joint election under |
| | SILVERCREST METALS INC. | 65 |
| | | 2025 Special Meeting of Securityholders |
| | | Section
85 of the Tax Act and applicable provincial tax Laws with an elected amount determined by
the Company in its sole discretion. Subsequently, Company Canadian Sub shall transfer, and
shall be deemed to transfer, all Bullion referred to above to Coeur U.S. Sub and, in consideration
therefor, Coeur U.S. Sub shall issue and deliver to Company Canadian Sub a U.S. dollar denominated
promissory note, with a principal amount equal to the purchase price of the Bullion, being
the fair market value thereof, bearing interest at the short-term Applicable Federal Rate
for U.S. tax purposes on the Effective Date plus 2% per annum, having a maturity date that
is December 31 of the year following the Effective Date. |
| (b) | Payment
of Intercompany Debt: Company Mexican Sub shall transfer a cash amount: (i) to the Company
equal to the lesser of (A) the principal amount outstanding under the Company Loan and
(B) Company Mexican Sub’s Specified Cash Balance; (ii) if Company Mexican Sub’s
Specified Cash Balance less the repayment described in (i) is positive, to the Company
equal to the lesser of (C) any accrued interest on the Company Loan and (D) Company
Mexican Sub’s Specified Cash Balance less the amount of the repayment described in
(i); and (iii) if Company
Mexican Sub’s Specified Cash Balance less the repayments described in (i) and (ii) is positive, to Company Canadian Sub equal to
the lesser of (E) the interest owing on that certain intercompany loan between Company Mexican Sub and Company Canadian Sub and
(F) Company Mexican Sub’s Specified Cash Balance less the amount of the repayments described in (i) and (ii); and following
this step, such amounts determined by this step shall be, and shall be deemed to be, repaid by Company Mexican Sub. |
| (c) | Dissenting
Shareholders: Each Dissent Share shall be and shall be deemed to be transferred and assigned
by the holder thereof without any further act or formality on its part, free and clear of
all Liens, to the Company in accordance with, and for the Consideration under the Plan of
Arrangement, and: (i) such Dissenting Shareholder shall cease to be, and shall be deemed
to cease to be, the registered holder of each such Dissent Share and the Company shall be
the holder of all of the outstanding Dissent Shares, free and clear of all Liens. |
| (d) | Issuance
of SilverCrest Shares to Coeur Canadian Sub: Each Shareholder, other than a Dissenting
Shareholder, shall transfer and assign their SilverCrest Shares, free and clear of any Liens,
to Coeur Canadian Sub in exchange for the Consideration for each such SilverCrest Share so
transferred, and in respect of the SilverCrest Shares so transferred, the registered holder
thereof shall cease to be, and shall be deemed to cease to be, the registered holder of each
such SilverCrest Share and Coeur Canadian Sub shall be the holder of all of the outstanding
SilverCrest Shares, free and clear of all Liens. |
| (e) | Treatment
of SilverCrest Options: Notwithstanding any vesting or exercise or other provisions to
which a SilverCrest Option might otherwise be subject (whether by contract, the conditions
of grant, applicable Law or the terms of the applicable Company Option Plan governing such
SilverCrest Option), each SilverCrest Option outstanding immediately prior to the Effective
Time shall, without any further action by or on behalf of a holder, be exchanged for a Replacement
Option exercisable to purchase from Coeur the number of Coeur Shares (rounded down to the
nearest whole number) equal to the product of (A) the number of SilverCrest Shares subject
to the SilverCrest Option immediately before the Effective Time multiplied by (B) the Exchange
Ratio. The exercise price per Coeur Share subject to any such Replacement Option shall be
an amount (rounded up to the nearest whole cent) equal to the quotient of (X) the exercise
price per SilverCrest Share underlying the exchanged SilverCrest Option immediately prior
to the Effective Time divided by (Y) the Exchange Ratio. It is intended that (i) the
provisions of Subsection 7(1.4) of the Tax Act apply to the aforesaid exchange of options
and (ii) such exchange of options be treated as other than the grant of a new stock right
or a change in the form of payment pursuant to Section 1.409A-1(b)(5)(v)(D) of the U.S. Treasury
Regulations. Accordingly, and notwithstanding the foregoing, if required, the exercise price
of a Replacement Option will be adjusted such that the In-The-Money Value of the
Replacement Option immediately after the exchange does not exceed the In-The-Money Value
of the SilverCrest Option for which it was exchanged immediately before the exchange. All
terms and conditions of a Replacement Option, including the term to expiry, conditions to
and manner of exercising, will be the same as the SilverCrest Option for which it was exchanged,
and shall be governed by the terms of the applicable Company Option Plan and any document
evidencing a SilverCrest Option shall thereafter evidence and be deemed to evidence such
Replacement Option, provided that the provisions of Section 7.1 of the New Company Option
Plan shall apply to all Replacement Options that would otherwise be governed by the Legacy
Company Option Plan for a period of ninety (90) days following the Effective Time. |
| (f) | Amalgamation
of the Company and Company Canadian Sub: At 9:00 a.m. (Vancouver time) on the day following
the Effective Date, the notice of articles of the Company shall be altered to the extent
necessary for the Company to become an unlimited liability company as contemplated pursuant
to Section 51.31(1) of the BCBCA, such that (i) the statement required under Section 51.11
of the BCBCA shall be included in the notice of articles of the Company; (ii) the name of
the Company shall be |
| | SILVERCREST METALS INC. | 66 |
| | | 2025 Special Meeting of Securityholders |
| | | changed to “SilverCrest Metals ULC” and the Company shall
thereupon be an unlimited liability company under the BCBCA and, as soon as practicable thereafter,
Coeur Canadian Sub, as sole shareholder of the Company, shall return all share certificates
representing the Company Shares for inclusion on the face of each such certificate the statement
required pursuant to Section 51.2 of the BCBCA; and (iii) Coeur Canadian Sub shall elect
to be classified as an association taxable as a corporation for U.S. federal income tax purposes
effective the day following the Effective Date. |
Effective Date
of the Arrangement
If the Arrangement
Resolution is passed with the SilverCrest Securityholder Approval, the Coeur Stockholder Approvals, the Final Order and the COFECE Approval
are obtained, every other requirement of the BCBCA relating to the Arrangement is complied with and all other conditions described under
“The Arrangement Agreement — Conditions to Closing” are satisfied or waived, the Arrangement will become effective
on the Effective Date. On completion of the Arrangement, the Company will be a wholly-owned subsidiary of Coeur.
Exchange of SilverCrest
Securities
Letter
of Transmittal
Registered Shareholders
will have received a Letter of Transmittal with this Circular. In order to receive the Consideration, such Shareholders (other than the
Dissenting Shareholders) must complete and sign the Letter of Transmittal enclosed with this Circular and deliver it and the other documents
required by it, including the certificates or DRS Advices representing the SilverCrest Shares, to the Depositary in accordance with the
instructions contained in the Letter of Transmittal. Beneficial Shareholders must contact their Intermediary for instructions and assistance
in receiving the Consideration for their SilverCrest Shares.
The Letter of
Transmittal contains procedural information relating to the Arrangement and should be reviewed carefully. Registered Shareholders (other
than the Dissenting Shareholders) can obtain additional copies of the Letter of Transmittal by contacting the Depositary at 1-800-564-6253
(within North America) or 1-514-982-7555 (international) or by e-mail at corporateactions@computershare.com. The Letter of Transmittal
is also available on the Company’s SEDAR+ profile at www.sedarplus.ca and on EDGAR at www.sec.gov.
Coeur, in its
absolute discretion, reserves the right to instruct the Depositary to waive or not to waive any and all defects or irregularities contained
in any Letter of Transmittal or other document and any such waiver or non-waiver will be binding upon the affected Shareholders. The
granting of a waiver to one or more Shareholders does not constitute a waiver for any other Shareholders. Coeur reserves the right to
demand strict compliance with the terms of the Letter of Transmittal and the Arrangement. The method used to deliver the Letter of Transmittal
and any accompanying certificates or DRS Advices representing the SilverCrest Shares is at the option and risk of the holder surrendering
them, and delivery will be deemed effective only when such documents are actually received by the Depositary. SilverCrest and Coeur recommend
that the necessary documentation be hand delivered to the Depositary, and a receipt obtained therefor; otherwise the use of registered
mail with an acknowledgment of receipt requested, and with proper insurance obtained, is recommended.
Exchange
Procedure
On the Effective
Date, each former Shareholder (other than a Dissenting Shareholder) who has surrendered to the Depositary certificates or DRS Advices
representing one or more outstanding SilverCrest Shares shall, following completion of the transactions described above under the heading
“The Arrangement – Plan of Arrangement”, be entitled to receive, and the Depositary shall deliver to such former
Shareholder following the Effective Time, certificates or DRS Advices representing the Consideration that such former Shareholder is
entitled to receive in accordance with the terms of the Arrangement.
Upon surrender
to the Depositary of a certificate or DRS Advice that immediately before the Effective Time represented one or more outstanding SilverCrest
Shares that were exchanged for the Consideration in accordance with the terms of the Arrangement, together with such other documents
and instruments as would have been required to effect the transfer of the SilverCrest Shares formerly represented by such certificate
or DRS Advice under the terms of such certificate or DRS Advice, the BCBCA or the articles of the Company and such additional documents
and instruments as the Depositary may reasonably require, the holder of such surrendered certificate or DRS Advice will be entitled to
receive in exchange therefor, and the Depositary will deliver to such holder following the
| | SILVERCREST METALS INC. | 67 |
| | | 2025 Special Meeting of Securityholders |
Effective Time, certificates or DRS Advices
representing the Consideration that such holder is entitled to receive in accordance with the terms of the Arrangement.
After the Effective
Time and until surrendered, each certificate or DRS Advice that immediately prior to the Effective Time represented one or more SilverCrest
Shares following completion of the transactions described above under the heading
“The
Arrangement – Plan of Arrangement”, shall be deemed at all times to represent only the right to receive in exchange therefor
the Consideration that the holder of such certificate or DRS Advice is entitled to receive in accordance with the terms of the Arrangement.
Shareholders
who hold SilverCrest Shares registered in the name of an Intermediary should contact the Intermediary for instructions and assistance
in providing details for registration and delivery of the Consideration to which the Beneficial Shareholder is entitled.
No dividends
or other distributions declared or made after the Effective Time with respect to Consideration Shares with a record date after the Effective
Time shall be paid to the holder of any unsurrendered certificate which, immediately prior to the Effective Time, represented outstanding
SilverCrest Shares that were exchanged for Consideration Shares until the holder of such certificate shall surrender such certificate
in accordance with the Arrangement as described in the foregoing paragraphs under the heading “Exchange Procedure”
or under the heading “Lost Certificates or DRS Advices”. Subject to applicable Law at the time of such surrender of
any certificate (or in the case of (ii) below, at the appropriate payment dates), there shall be paid to such holder of certificates
representing SilverCrest Shares that were exchanged for Consideration Shares, (i) the amount of dividends or other distributions with
a record date after the Effective Time theretofore paid with respect to the Consideration Shares to which such holder is entitled pursuant
to the Plan of Arrangement, and (ii) to the extent not paid under (i), on the appropriate payment date, the amount of dividends or other
distributions with a record date after the Effective Time but prior to surrender and the payment date subsequent to surrender payable
with respect to such Consideration Shares.
DRS Advice
Where SilverCrest
Shares are evidenced only by DRS Advice(s), there is no requirement to first obtain a certificate for those SilverCrest Shares or deposit
with the Depositary any SilverCrest Share certificate evidencing SilverCrest Shares. Only a properly completed and duly executed Letter
of Transmittal accompanied by the applicable DRS Advices is required to be delivered to the Depositary in order to surrender those SilverCrest
Shares under the Arrangement. Coeur reserves the right if it so elects in its absolute discretion to instruct the Depositary to waive
any defect or irregularity contained in any Letter of Transmittal received by it.
Treatment
of SilverCrest Options
Each SilverCrest
Option outstanding immediately prior to the Effective Time shall, without any further action by or on behalf of a holder, be exchanged
for a Replacement Option exercisable to purchase from Coeur the number of Coeur Shares (rounded down to the nearest whole number) equal
to the product of (A) the number of SilverCrest Shares subject to the SilverCrest Option immediately before the Effective Time multiplied
by (B) the Exchange Ratio. The exercise price per Coeur Share subject to any such Replacement Option shall be an amount (rounded up to
the nearest whole cent) equal to the quotient of (X) the exercise price per SilverCrest Share underlying the exchanged SilverCrest Option
immediately prior to the Effective Time divided by (Y) the Exchange Ratio. It is intended that (i) the provisions of Subsection
7(1.4) of the Tax Act apply to the aforesaid exchange of options and (ii) such exchange of options be treated as other than the grant
of a new stock right or a change in the form of payment pursuant to Section 1.409A-1(b)(5)(v)(D) of the U.S. Treasury Regulations. Accordingly,
and notwithstanding the foregoing, if required, the exercise price of a Replacement Option will be adjusted such that the In-The-Money
Value of the Replacement Option immediately after the exchange does not exceed the In-The-Money Value of the SilverCrest Option for which
it was exchanged immediately before the exchange. All terms and conditions of a Replacement Option, including the term to expiry, conditions
to and manner of exercising, will be the same as the SilverCrest Option for which it was exchanged, and shall be governed by the terms
of the applicable Company Option Plan and any document evidencing a SilverCrest Option shall thereafter evidence and be deemed to evidence
such Replacement Option, provided that the provisions of Section 7.1 of the New Company Option Plan shall apply to all Replacement Options
that would otherwise be governed by the Legacy Company Option Plan for a period of ninety (90) days following the Effective Time.
Lost Certificates
or DRS Advices
In the event any
certificate which immediately prior to the Effective Time represented one or more outstanding SilverCrest Shares that were exchanged
for Consideration pursuant to the Plan of Arrangement, shall have been lost, stolen or destroyed, upon the making
| | SILVERCREST METALS INC. | 68 |
| | | 2025 Special Meeting of Securityholders |
of an
affidavit of that fact by the person claiming such certificate to be lost, stolen or destroyed, the Depositary will issue in
exchange for such lost, stolen or destroyed certificate the Consideration payable and deliverable in accordance with such
holder’s duly completed and executed Letter of Transmittal. When authorizing such payment and delivery in exchange for any
lost, stolen or destroyed certificate, the person to whom such Consideration is to be paid and delivered shall as a condition
precedent to the payment and delivery of such Consideration, give a bond satisfactory to Coeur and the Depositary (each acting
reasonably) in such amount as Coeur may direct (each acting reasonably), or otherwise indemnify Coeur and the Depositary and/or any
of their respective representatives or agents in a manner satisfactory to Coeur and the Depositary, each acting reasonably, against
any claim that may be made against Coeur or the Depositary and/or any of their respective representatives or agents with respect to
the certificate alleged to have been lost, stolen or destroyed.
If a DRS Advice
representing SilverCrest Shares has been lost, stolen or destroyed, the holder can request a copy of the DRS Advice by contacting Computershare
Investor Services Inc. by phone: toll-free in North America at 1-800-564-6253 or international at 1-514-982-7555, with no bond indemnity
required and such copy of the DRS Advice should be deposited with the Letter of Transmittal.
Extinction
of Rights
If any Shareholder
fails to deliver to the Depositary the certificate(s) or DRS Advice(s), documents or instruments required to be delivered to the Depositary
in the manner described in this Circular on or before the date that is six years after the Effective Date, on such date: (a) such certificate(s)
or DRS Advice(s) will cease to represent a claim or interest of any kind or nature as a securityholder of SilverCrest or Coeur, (b) the
Consideration Shares, as applicable, to which the former holder of such certificate(s) or DRS Advice(s) was ultimately entitled shall
be deemed to have been surrendered for no consideration to Coeur Canadian Sub (or its successor(s)), and (c) none of Coeur, Coeur Canadian
Sub, SilverCrest or the Depositary shall be liable to any Person in respect of any Consideration Shares (or dividends, distributions
and interest in respect thereof) delivered to a public official pursuant to any applicable abandoned property, escheat or similar law.
Mail Services
Interruption
Notwithstanding
the provisions of the Arrangement, this Circular and the Letter of Transmittal, certificates or DRS Advices representing Consideration
for SilverCrest Shares deposited pursuant to the Arrangement and any DRS Advice(s) or certificate(s), as applicable, representing SilverCrest
Shares to be returned will not be mailed if Coeur determines that delivery thereof by mail may be delayed.
Persons entitled
to DRS Advices, certificates, and other relevant documents which are not mailed for the foregoing reason may take delivery thereof at
the office of the Depositary at which the deposited DRS Advice(s) or certificate(s) representing SilverCrest Shares in respect of which
Coeur Shares are being issued were originally deposited upon application to the Depositary until such time as Coeur has determined that
delivery by mail will no longer be delayed.
No Fractional
Shares to be Issued
No fractional
Consideration Shares will be issued to former Shareholders. Where the aggregate number of Consideration Shares to be issued to a Shareholder
under the Arrangement would result in a fractional Consideration Share being issuable, such fractional Consideration Share will be rounded
up to the nearest whole Consideration Share in the event that a Shareholder is entitled to a fractional share representing 0.5 or more
of a Consideration Share and will be rounded down to the nearest whole Consideration Share in the event that a Shareholder is entitled
to a fractional share representing less than 0.5 of a Consideration Share.
Withholding
Rights
SilverCrest,
Coeur, the Depositary, their respective Subsidiaries and any other Person on their behalf, shall be entitled to deduct and withhold
from any amounts payable to any Securityholder pursuant to the Arrangement or under the Plan of Arrangement (including amounts
payable to Dissenting Shareholders and Optionholders), such amounts as SilverCrest, Coeur, the Depositary and their respective
Subsidiaries, or any Person on behalf of any of the foregoing, is or may be required or permitted to deduct or withhold with respect
to such payment under the Tax Act, the Code, or any provision of local, state, federal,
provincial or foreign Law, in each case, as amended, or under the administrative practice of the relevant Governmental Entity
administering such Law, and to request from any recipient of any payment hereunder any necessary tax forms or any other proof of
exemption from withholding or any similar information. To the extent that amounts are so deducted or withheld, such deducted or
withheld amounts shall be treated for all
| | SILVERCREST METALS INC. | 69 |
| | | 2025 Special Meeting of Securityholders |
purposes hereof as having been paid to the Person to whom such amounts would otherwise
have been paid. In any case where the amount so required or permitted to be deducted or withheld from any payment to a holder
exceeds the cash portion of the consideration otherwise payable, SilverCrest, Coeur, the Depositary, their respective Subsidiaries,
and any Person on behalf of the foregoing, as the case may be, is authorized to sell or otherwise dispose of such portion of the
Consideration as is necessary in order to fully fund such liability, and such Person shall remit any unapplied balance of the net
proceeds of such sale to the holder.
Effects of the
Arrangement on Shareholders’ Rights
Shareholders
receiving Consideration Shares under the Arrangement will become Coeur Stockholders. Coeur is a company existing under the laws of the
State of Delaware, and the Coeur Shares are listed on the NYSE under the symbol “CDE”.
See Appendix
L to this Circular for a summary comparison of the rights of Shareholders and Coeur Stockholders.
Interests of Certain
Persons in the Arrangement
In considering
the Arrangement and the recommendations of the Board with respect to the Arrangement, Securityholders should be aware that certain directors
and senior officers of the Company have certain interests that are, or may be, different from, or in addition to, the interests of other
Securityholders generally, which may present them with actual or potential conflicts of interest in connection with the Arrangement.
The Board is aware of these interests and considered them along with the other matters described above in “The Arrangement –
Reasons for the Arrangement”. These interests include those described below.
Securities
Held by Directors and Senior Officers of the Company
The table below
sets out for each director and senior officer of the Company as of the Record Date the number of SilverCrest Shares, SilverCrest Options,
SilverCrest RSUs, SilverCrest PSUs and SilverCrest DSUs beneficially owned or controlled or directed by each of them and their associates
and affiliates. Only the SilverCrest Shares and SilverCrest Options will be entitled to be voted at the Meeting.
| Name,
Province and Country of Residence, and Position with the Company |
Number
of SilverCrest Shares and
% of Class(1) |
Number
of SilverCrest Options and
% of Class(2) |
Number
of SilverCrest RSUs and
% of Class(3) |
Number
of SilverCrest PSUs and
% of Class(4) |
Number
of SilverCrest DSUs and
% of Class(5) |
Directors
|
|
|
|
|
|
N. Eric Fier
British Columbia,
Canada
Chief Executive
Officer and Director |
2,064,075
1.4% |
399,500
16.9% |
72,782
16.3% |
54,850
29.2% |
-
-% |
John H. Wright
British Columbia,
Canada
Director and Board Chair |
254,146
0.2% |
-
-% |
-
-% |
-
-% |
58,300
16.8% |
Anna Ladd Kruger
British Columbia,
Canada
Director |
-
-% |
25,000
1.1% |
-
-% |
-
-% |
39,500
11.4% |
Hannes Portmann
Ontario, Canada
Director |
40,000
0.0% |
-
-% |
-
-% |
-
-% |
55,000
15.9% |
Ani Markova
Ontario, Canada
Director |
15,901
0.0% |
-
-% |
-
-% |
-
-% |
55,000
15.9% |
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| Name,
Province and Country of Residence, and Position with the Company |
Number
of SilverCrest Shares and
% of Class(1) |
Number
of SilverCrest Options and
% of Class(2) |
Number
of SilverCrest RSUs and
% of Class(3) |
Number
of SilverCrest PSUs and
% of Class(4) |
Number
of SilverCrest DSUs and
% of Class(5) |
| |
|
|
|
|
|
Laura Diaz
Mexico City, Mexico
Director |
-
-% |
25,000
1.1% |
-
-% |
-
-% |
56,000
16.1% |
Graham C. Thody
British Columbia,
Canada
Director |
30,000
0.0% |
-
-% |
-
-% |
-
-% |
66,500
19.2% |
Pierre Beaudoin
Québec, Canada
Director |
92,665
0.1% |
99,834
4.2% |
8,000
1.8% |
15,000
8.0% |
16,500
4.8% |
Senior
Officers
|
|
|
|
|
|
Christoper Ritchie
British Columbia,
Canada
President |
590,900
0.4% |
242,100
10.2% |
42,900
9.6% |
32,400
17.2% |
-
-% |
Robert Doyle
British Columbia,
Canada
Interim
Chief Financial Officer |
2,925
0.0% |
-
-% |
6,500
1.3% |
-
-% |
-
-% |
Anne
Yong
British
Columbia, Canada
Vice President,
Governance, Risk and Sustainability |
170,596
0.1% |
142,350
6.0% |
25,966
5.8% |
19,400
10.3% |
-
-% |
Cliff Lafleur
Ontario, Canada
Vice
President, Operations |
-
-% |
194,668
8.2% |
25,466
5.7% |
19,400
10.3% |
-
-% |
Tara Hassan
British Columbia,
Canada
Vice
President, Corporate Development |
-
-% |
318,500
13.5% |
25,300
5.7% |
19,400
10.3% |
-
-% |
Sean Deissner
British Columbia,
Canada
Vice President,
Financial Reporting |
7,244
-% |
61,734
2.6% |
16,600
3.3% |
8,300
4.4% |
-
-% |
Stephany Fier
British Columbia,
Canada
Vice
President, Exploration |
150,000
0.1% |
145,750
6.2% |
25,634
5.8% |
19,400
10.3% |
-
-% |
Bernard Poznanski
British Columbia,
Canada
Corporate Secretary |
23,483
0.0% |
26,000
1.1% |
-
-% |
-
-% |
-
-% |
| Total |
3,441,935
2.3% |
1,680,436
71.0% |
249,148
55.9% |
188,150
100.0% |
346,800
100.0% |
Notes:
| (1) | Based
on 149,188,518 SilverCrest Shares issued and outstanding as at the Record Date. As a group,
all current directors and senior officers beneficially own, directly or indirectly, or exercise
control or discretion over, as of the Record Date, a total of 3,441,935 SilverCrest Shares,
representing approximately 2.3% of the issued and outstanding SilverCrest Shares. |
| (2) | Based
on 2,365,586 SilverCrest Options issued and outstanding as at the Record Date. As a group,
all current directors and senior officers beneficially own, directly or indirectly, or exercise
control or discretion over, as of the Record Date, a total of 1,680,436 SilverCrest Options,
representing approximately 71.0% of the issued and outstanding SilverCrest Options. |
| (3) | Based
on 445,632 SilverCrest RSUs issued and outstanding as at the Record Date. As a group, all
current senior officers and Mr. Beaudoin (having received SilverCrest RSUs in his previous
role as Chief Operating Officer) beneficially own, directly or indirectly, or exercise control
or discretion over, as of the Record Date, a total of 249,148 SilverCrest RSUs, representing
approximately 55.9% of the issued and outstanding SilverCrest RSUs. |
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| | | 2025 Special Meeting of Securityholders |
| (4) | Based
on 188,150 SilverCrest PSUs issued and outstanding as at the Record Date. As a group, all
current directors and senior officers beneficially own, directly or indirectly, or exercise
control or discretion over, as of the Record Date, a total of 188,150 SilverCrest PSUs, representing
100% of the issued and outstanding SilverCrest PSUs. |
| (5) | Based
on 346,800 SilverCrest DSUs issued and outstanding as at the Record Date. As a group, all
current directors and senior officers beneficially own, directly or indirectly, or exercise
control or discretion over, as of the Record Date, a total of 346,800 SilverCrest DSUs, representing
100% of the issued and outstanding SilverCrest DSUs. |
SilverCrest
Shares
As of the Record
Date, the directors and senior officers of the Company beneficially own, control or direct, directly or indirectly, an aggregate of 3,441,935
SilverCrest Shares that will be entitled to be voted at the Meeting, representing approximately 2.3% of the issued and outstanding SilverCrest
Shares as of the Record Date.
All of the SilverCrest
Shares owned or controlled by such directors and senior officers of the Company will be treated in the same manner under the Arrangement
as SilverCrest Shares held by any other Shareholder.
If the Arrangement
is completed, the directors and senior officers of the Company will receive as a group, in exchange for such SilverCrest Shares held
at the Effective Time, an aggregate of approximately 5,514,668 Coeur Shares.
SilverCrest
Options
As of the Record
Date, the directors and senior officers of the Company hold SilverCrest Options exercisable for an aggregate of 1,680,436 SilverCrest
Shares that will be entitled to be voted at the Meeting, which, when combined with the SilverCrest Shares held by such directors and
senior officers, represents approximately 3.4% of the issued and outstanding SilverCrest Shares and SilverCrest Options collectively
as of the Record Date. These SilverCrest Options have exercise prices ranging from C$7.13 to C$12.63 per SilverCrest Share.
If the Arrangement
is completed, the directors and senior officers of SilverCrest will receive as a group, in exchange for such SilverCrest Options held
on the Effective Time, an aggregate of approximately 2,692,395 Replacement Options to acquire approximately 2,692,395 Coeur Shares at
exercise prices ranging from approximately C$4.45 to C$7.88 per Coeur Share.
SilverCrest
RSUs, PSUs and DSUs
As of the Record
Date, the directors and senior officers of the Company hold an aggregate of 249,148 SilverCrest RSUs, 188,150 SilverCrest PSUs and 346,800
SilverCrest DSUs. If the Arrangement is completed, the directors and senior officers of the Company will receive, as a group, cash payments
in the aggregate amount of C$10,946,008.08 (assuming a price per Silvercrest Share equal to C$13.96, being the closing price of SilverCrest
Shares on the TSX on January 7, 2025), less applicable withholding Taxes, upon the settlement of all the SilverCrest RSUs, SilverCrest
PSUs and SilverCrest DSUs outstanding immediately prior to the Effective Time in accordance with the terms of the Arrangement Agreement
and the Company Share Unit Plan.
Employment
Agreements and Compensation Bonus
The Company is
party to employment and management consulting agreements (collectively, the “Employment Agreements”) with certain
senior officers currently employed by the Company, being N. Eric Fier, Christopher Ritchie, Cliff Lafleur, Tara Hassan, Anne Yong,
Sean Deissner, and Stephany Fier, which provide for termination payments in certain circumstances, as well as certain payments and
benefits in the event of a “change of control” (as defined in the respective Employment Agreements) and within
certain timeframes following such change of control, such senior officers are terminated. The Arrangement will constitute a
“change of control” for the purposes of the Employment Agreements.
N. Eric Fier
(through Maverick)
With respect
to Mr. Fier, who provides his services as the Chief Executive Officer of the Company through Maverick Mining Consultants Inc. (“Maverick”)
pursuant to a management consulting agreement with the Company (the “Maverick Agreement”), if either (a) within six
months after the date of the change of control, the Company terminates the Maverick agreement, or (b) within three months after the date
of change of control, Mr. Fier (i) is not offered the position of Chief Executive Officer of the successor company, or (ii) is
| | SILVERCREST METALS INC. | 72 |
| | | 2025 Special Meeting of Securityholders |
offered
and declines to accept the position of Chief Executive Officer of the successor company, and Maverick elects to terminate the Maverick
Agreement, then the Company must pay to Maverick a change of control payment equal to two (2) times of both the then applicable base
rate per annum payable to Maverick, a payment equal to two (2) times the pro rata amount of the previous year’s bonus paid
or payable to Maverick by the Company. The change of control benefit would not be triggered if Mr. Fier was offered and accepted the
position of Chief Executive Officer of the successor company.
Other Senior
Officers
With respect
to the other senior officers, pursuant to their Employment Agreements, if the senior officer is terminated within six months of a change
of control of the Company, the senior officer is entitled to receive an amount equal to the aggregate of the following:
| (1) | in
the case of Mr. Ritchie and Ms. Yong, 24 months of the then annual base salary and, in the
case of Ms. Hassan, Mr. Lafleur, Mr. Deissner and Ms. Fier, 18 months of the then annual
base salary; |
| (2) | 1.5
times of any bonus paid or payable to the officer in respect of the Company’s most
recently completed financial year; and |
| (3) | the
cash equivalent of the officer’s accrued vacation pay. |
In addition to
the foregoing, the senior officers are entitled to a continuation of medical, dental and other employee benefits for the applicable time
period indicated in subparagraph (1) above.
With respect
to Mr. Doyle, who provides his services as the Interim Chief Financial Officer of the Company through Sinamatella Solutions Ltd. (“Sinamatella”)
pursuant to a management consulting agreement with the Company (the “Sinamatella Agreement”), Sinamatella is entitled
to receive retention bonus payments of (i) C$167,000 on March 31, 2025 and (ii) C$166,000 on September 30, 2025. The Sinamatella
Agreement will automatically terminate on March 31, 2025, and if the Effective Date occurs after March 31, 2025, the Company will extend
the term of the Sinamatella Agreement until the Effective Date. If Mr. Doyle is terminated within 60 days of a change of control of the
Company, Mr. Doyle is entitled to receive all outstanding retention bonus payments.
Summary of
Estimated Change of Control Benefits
The table below summarizes
the estimated change of control benefits reflecting the maximum amount of base salary and assuming the maximum 2024 annual incentive
that may be payable to each senior officer if such officer’s applicable Employment Agreement is terminated within the prescribed
timeframes following the Effective Date, assuming an Effective Date of March 31, 2025. Final base salary and annual incentive amounts
are all subject to review, which will occur in Q1 2025 by the Compensation Committee of the Board, and approval by the Board.
| Name |
Base
Salary (C$) |
Annual
Incentive (C$) |
Other
(C$)1 |
Total
(C$) |
| N. Eric Fier (Maverick) |
1,344,000 |
473,425 |
- |
1,817,425 |
| Chris Ritchie |
1,033,200 |
885,600 |
100,827 |
2,019,627 |
| Robert Doyle (Sinamatella) |
- |
- |
166,000 |
166,000 |
| Anne Yong |
753,375 |
484,313 |
73,496 |
1,311,185 |
| Cliff Lafleur |
630,000 |
675,000 |
93,513 |
1,398,513 |
| Tara Hassan |
565,031 |
565,031 |
60,744 |
1,190,807 |
| Sean Deissner |
441,000 |
378,000 |
51,004 |
870,004 |
| Stephany
Fier |
565,031
|
484,313
|
37,362
|
1,086,706 |
| (1) | Amounts
estimated based on current vacation and continuation of medical, dental and other employee
benefits for the applicable time period to be paid out. |
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Insurance
Indemnification of Directors and Officers of the Company
The Arrangement
Agreement provides that, prior to the Effective Time, the Company shall purchase customary “tail” policies of directors’
and officers’ liability insurance providing protection no less favourable in the aggregate than the protection provided by the
policies maintained by the Company and its subsidiaries which are in effect immediately prior to the Effective Date and providing protection
in respect of claims arising from facts or events which occurred on or prior to the Effective Date and Coeur will, or will cause the
Company and its subsidiaries to maintain such tail policies in effect without any reduction in scope or coverage for six years following
the Effective Date; provided that that (i) Coeur shall not be required to pay any amounts in respect of such coverage prior to the Effective
Time, and (ii) the cost of such policies shall not exceed 400% of the Company’s current annual premium for policies currently maintained
by the Company or its Subsidiaries.
SilverCrest Securityholder
Approval
At
the Meeting, pursuant to the Interim Order, Securityholders will be asked to approve the Arrangement Resolution. The complete text of
the Arrangement Resolution to be presented to the Meeting is set forth in Appendix A to this Circular. Each Securityholder as at the
Record Date will be entitled to vote on the Arrangement Resolution. The Arrangement Resolution must be approved with the SilverCrest
Securityholder Approval, which is by at least (i) 66⅔% of the votes cast by Shareholders present in person or represented by proxy
and entitled to vote at the Meeting; (ii) 66⅔% of the votes cast by Securityholders, voting together as a single class, present
in person or represented by proxy and entitled to vote at the Meeting, with Shareholders and Optionholders being entitled to one vote
for each SilverCrest Share and SilverCrest Option, respectively, and (iii) a simple majority of the votes cast by Shareholders present
in person or represented by proxy and entitled to vote at the Meeting, excluding the Excluded Shares for the purposes of MI 61-101.
The Arrangement
Resolution must receive the SilverCrest Securityholder Approval in order for the Company to seek the Final Order and implement the Arrangement
on the Effective Date in accordance with the terms of the Final Order.
Coeur Stockholder
Approvals
Pursuant to Section
312.03(c) and Section 312.07 of the NYSE Listed Company Manual, the Coeur Stock Issuance must be approved by at least a majority of the
votes cast in person or represented by proxy at the Coeur Meeting. As required by the certificate of incorporation of Coeur and the DGCL,
the Coeur Charter Amendment must be approved by at least a majority of the votes cast in person or represented by proxy at the Coeur
Meeting. If the Coeur Stock Issuance or the Coeur Charter Amendment is not approved by the Coeur Stockholders, the Arrangement cannot
be completed.
Court Approval
of the Arrangement
Interim
Order
The Arrangement
requires approval by the Court under Division 5 of Part 9 of the BCBCA. Prior to the mailing of this Circular, the Company obtained the
Interim Order providing for the calling and holding of the Meeting, the Dissent Rights and other procedural matters. A copy of the Interim
Order is attached as Appendix C to this Circular.
Final Order
Subject to the
approval of the Arrangement Resolution by Securityholders at the Meeting, the Company intends to make an application to the Court for
the Final Order approving the Arrangement. The application for the Final Order is expected to take place at the courthouse of the Court
at 800 Smithe Street, Vancouver, British Columbia at 9:45 a.m. (Vancouver time) on February 11, 2025, or as soon thereafter as counsel
may be heard, or at any other date and time and by any other method as the Court may direct. A copy of the Petition and Notice of Hearing
of Petition is set forth in Appendix D to this Circular.
The Court has
broad discretion under the BCBCA when making orders with respect to the Arrangement. The Court will consider, among other things, the
fairness and reasonableness of the Arrangement, both from a substantive and a procedural point of view. The Court may approve the Arrangement,
either as proposed or as amended, on the terms presented or substantially on those terms. Depending upon the nature of any required amendments,
SilverCrest or Coeur may determine not to proceed with the Arrangement. Prior to the hearing on the Final Order, the Court will be informed
that the Final Order will also constitute the basis for an exemption from
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registration under the U.S. Securities Act for the Consideration
Shares to be issued in the Arrangement to holders of SilverCrest Shares and for the issuance of the Replacement Options to be issued
in the Arrangement, each pursuant to Section 3(a)(10) of the U.S. Securities Act.
Any Securityholder
or any other interested party who wishes to appear or be represented and to present evidence or arguments at that hearing of the application
for the Final Order must file and serve a Response to Petition by no later than 4:00 p.m. (Vancouver time) on February 7, 2025, along
with any other documents required, all as set out in the Interim Order and the Petition and Notice of Hearing of Petition, the text of
which are set out in Appendix C and Appendix D to this Circular, respectively, and satisfy any other requirements of the Court. Such
persons should consult with their legal advisors as to the necessary requirements. In the event that the hearing is adjourned, then,
subject to further order of the Court, only those persons having previously filed and served a Response to Petition will be given notice
of the adjournment.
For further information
regarding the Court hearing and your rights in connection with the Court hearing, see the Petition and Notice of Hearing of Petition
attached at Appendix D to this Circular. The Petition and Notice of Hearing of Petition constitute notice of the Court hearing of the
application for the Final Order and is your only notice of the Court hearing.
Each of the (i) Consideration
Shares to be issued pursuant to the Arrangement to Shareholders in exchange for their SilverCrest Shares and (ii) Replacement Options
to be issued pursuant to the Arrangement in exchange for SilverCrest Options have not been and will not be registered under the U.S.
Securities Act or any U.S. Securities Laws, and are being issued in reliance on the exemption from registration under the U.S. Securities
Act provided by Section 3(a)(10) thereof. The issuance of the foregoing securities shall be exempt from, or not subject to, U.S. state
securities, or “blue sky”, laws. The Court has been advised that if the terms and conditions of the Arrangement and such
issuance of SilverCrest Shares and Replacement Options are approved by the Court, the Company and Coeur intend to rely upon the Final
Order of the Court approving the Arrangement and such issuance of Consideration Shares and Replacement Options as a basis for the exemption
from registration under the U.S. Securities Act for such issuance of the Consideration Shares and Replacement Options pursuant to the
Arrangement. Therefore, subject to the additional requirements of Section 3(a)(10) of the U.S. Securities Act, should the Court make
a Final Order approving the Arrangement and such issuance of the Consideration Shares and Replacement Options, such Coeur Shares and
Replacement Options issued pursuant to the Arrangement will be exempt from registration under the U.S. Securities Act pursuant to Section
3(a)(10) of the U.S. Securities Act.
Dissenting
Shareholders’ Rights
The
following is a summary of the provisions of the BCBCA relating to a Shareholder’s dissent and appraisal rights in respect of
the Arrangement Resolution. Such summary is not a comprehensive statement of the procedures to be followed by a Dissenting
Shareholder who seeks payment of the fair value of its SilverCrest Shares. This summary is qualified in its entirety by reference to
the full text of Division 2 of Part 8 of the BCBCA, which is attached as Appendix K to this Circular, as modified by the Plan of
Arrangement and the Interim Order (which is attached at Appendix C to this Circular). The Court hearing the application for the
Final Order has the discretion to alter the Dissent Rights described herein based on the evidence presented at such hearing.
The statutory
provisions dealing with the right of dissent are technical and complex. Any Shareholder seeking to exercise his, her or its Dissent Rights
should seek independent legal advice, as failure to strictly comply with the requirements set forth in Division 2 of Part 8 of the
BCBCA, as modified by the Interim Order and the Plan of Arrangement, may result in the loss of any right of dissent.
Pursuant to the
Interim Order, each Registered Shareholder as at the close of business on the Record Date may exercise Dissent Rights in respect of the
Arrangement under Division 2 of Part 8 of the BCBCA, as modified by the Plan of Arrangement and the Interim Order and the Final Order.
Registered Shareholders who duly and validly exercise such Dissent Rights and who:
| · | are
ultimately entitled to be paid fair value for their Dissent Shares: (A) will be entitled
to be paid the fair value of such Dissent Shares by SilverCrest, which fair value, notwithstanding
anything to the contrary contained in the BCBCA, shall be the fair value of such Dissent
Shares determined as of the close of business on the day immediately before the approval
of the Arrangement Resolution; (B) will be deemed not to have participated in the transactions
in the Plan of Arrangement (other than Section 2.3(d) of the Plan of Arrangement, if applicable);
(C) will be deemed to have transferred and assigned such Dissent Shares, free and clear of
any liens, to SilverCrest); and (D) will not be entitled to any other payment or consideration,
including any payment that would be payable under the Arrangement had such holders not exercised
their Dissent Rights in respect of such SilverCrest Shares ; and |
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| · | are
ultimately not entitled, for any reason, to be paid fair value for their Dissent Shares,
will be deemed to have participated in the Arrangement, as of the Effective Time, on the
same basis as a non-dissenting Registered Shareholder and will be entitled to receive only
the Consideration that such holder would have received pursuant to the Arrangement if such
holder had not exercised Dissent Rights; |
In no circumstances
shall Coeur, Coeur Canadian Sub, SilverCrest or any other Person be required to recognize a Person exercising Dissent Rights unless such
Person is the registered holder of those SilverCrest Shares in respect of which such rights are sought to be exercised as of the Record
Date and as of the deadline for exercising such Dissent Rights. In no case shall Coeur, Coeur Canadian Sub, SilverCrest or any other
Person be required to recognize holders of SilverCrest Shares who exercise Dissent Rights as holders of SilverCrest Shares after the
time that is immediately prior to the Effective Time, and the names of the Dissenting Shareholders shall be deleted from the central
securities register as holders of SilverCrest Shares.
Pursuant to Division
2 of Part 8 of the BCBCA, every Registered Shareholder who duly and validly dissents from the Arrangement Resolution in strict compliance
with Division 2 of Part 8 of the BCBCA, as modified by the Interim Order, the Final Order and the Plan of Arrangement will be entitled
to be paid the fair value of the SilverCrest Shares held by such Dissenting Shareholder determined as at the point in time immediately
before the passing of the Arrangement Resolution.
To exercise Dissent
Rights, a Registered Shareholder as at the close of business on the Record Date must dissent with respect to all SilverCrest Shares in
which the holder owns either a registered or beneficial interest. A Registered Shareholder who wishes to dissent must deliver written
notice of dissent (a “Notice of Dissent”) to SilverCrest, c/o Cassels, Brock & Blackwell LLP, Suite 2200, RBC
Place, 885 West Georgia Street, Vancouver, British Columbia V6C 3E8, Attention: Rajit Mittal by 4:00 p.m. (Vancouver time) on or before
February 4, 2025 (or by 4:00 p.m. (Vancouver time) on the business day that is two business days immediately preceding the Meeting if
it is not held on February 6, 2025), and such Notice of Dissent must strictly comply with the requirements of Section 242 of the BCBCA.
Any failure by a Shareholder to fully comply may result in the loss of that holder’s Dissent Rights. Beneficial Shareholders who
wish to exercise Dissent Rights must arrange for the Registered Shareholder holding their SilverCrest Shares to deliver the Notice of
Dissent.
The delivery
of a Notice of Dissent does not deprive a Dissenting Shareholder of the right to vote at the Meeting on the Arrangement Resolution; however,
a Dissenting Shareholder is not entitled to exercise the Dissent Rights with respect to any of his or her SilverCrest Shares if the Dissenting
Shareholder votes in favour of the Arrangement Resolution. A vote against the Arrangement Resolution, whether in person or by proxy,
does not constitute a Notice of Dissent.
A Registered
Shareholder that wishes to exercise Dissent Rights must prepare a separate Notice of Dissent for himself, herself, or itself if dissenting
on his, her or its own behalf, and for each other person who beneficially owns SilverCrest Shares registered in the Dissenting Shareholder’s
name and on whose behalf the Dissenting Shareholder is dissenting, and must dissent with respect to all of the SilverCrest Shares registered
in his, her or its name beneficially owned by the Beneficial Shareholder on whose behalf he or she is dissenting. The Notice of Dissent
must set out the number of SilverCrest Shares in respect of which the Notice of Dissent is to be sent (the “Notice Shares”)
and:
| · | if
such Notice Shares constitute all of the SilverCrest Shares of which the holder is the registered
and beneficial owner and the holder owns no other SilverCrest Shares beneficially, a statement
to that effect; |
| · | if
such Notice Shares constitute all of the SilverCrest Shares of which the holder is both the
registered and beneficial owner, but the holder owns additional SilverCrest Shares beneficially,
a statement to that effect and the names of the registered holders of SilverCrest Shares,
the number of SilverCrest Shares held by each such holder and a statement that written notices
of dissent are being or have been sent with respect to such other SilverCrest Shares; or |
| · | if
the Dissent Rights are being exercised by a holder of SilverCrest Shares on behalf of a beneficial
owner of SilverCrest Shares who is not the dissenting shareholder, a statement to that effect
and the name and address of the beneficial holder of the SilverCrest Shares and a statement
that the registered holder is dissenting with respect to all SilverCrest Shares of the beneficial
holder registered in such registered holder’s name. |
It is a condition
to Coeur’s obligation to complete the Arrangement that Shareholders have not validly exercised (and not withdrawn such exercise)
Dissent Rights representing more than 5% of the issued and outstanding SilverCrest Shares. Each of the directors and
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senior officers
of the Company has agreed to waive his or her Dissent Rights as a holder of SilverCrest Shares pursuant to their SilverCrest Voting Agreements.
If the Arrangement
Resolution is approved by the SilverCrest Securityholder Approval and if SilverCrest notifies the Dissenting Shareholder of the Company’s
intention to act upon the Arrangement Resolution, the Dissenting Shareholder, if he, she or it wishes to proceed with the dissent, is
required, within one month after SilverCrest gives such notice, to send to SilverCrest the certificates (if any) representing the Notice
Shares and a written statement that requires SilverCrest to purchase all of the Notice Shares (including a written statement prepared
in accordance with Section 244(1)(c) of the BCBCA if the dissent is being exercised by a Registered Shareholder on behalf of a Beneficial
Shareholder), whereupon, subject to the provisions of the BCBCA relating to the termination of Dissent Rights, the Shareholder becomes
a Dissenting Shareholder, and is bound to sell, and Coeur is bound to purchase, those SilverCrest Shares. Such Dissenting Shareholder
may not vote or exercise or assert any rights of a Shareholder in respect of such Notice Shares, other than the rights set forth in Sections
237 to 247 of the BCBCA, as modified by the Plan of Arrangement, Interim Order and Final Order.
The Dissenting
Shareholder and SilverCrest may agree on the payout value of the Notice Shares; otherwise, either party may apply to the Court to determine
the fair value of the Notice Shares. There is no obligation on SilverCrest or Coeur to make an application to the Court. After a determination
of the payout value of the Notice Shares, SilverCrest must then promptly pay that amount to the Dissenting Shareholder. There can be
no assurance that the amount a Dissenting Shareholder may receive as fair value for its SilverCrest Shares will be more than or equal
to the Consideration under the Arrangement. It should be noted that an investment banking opinion as to the fairness, from a financial
point of view, of the consideration payable in a transaction such as the Arrangement is not an opinion as to fair value under the BCBCA.
In no
circumstances will SilverCrest, Coeur, the Depositary or any other person be required to recognize a person as a Dissenting
Shareholder unless such person is the holder of the SilverCrest Shares in respect of which Dissent Rights are purported to be
exercised immediately prior to the Effective Time of the Arrangement; (i) if such person has voted or instructed a proxyholder to
vote the Notice Shares in favour of the Arrangement Resolution; and (ii) unless such person has strictly complied with the
procedures for exercising Dissent Rights set out in Sections 237 to 247 of the BCBCA, as modified by the Plan of Arrangement,
Interim Order and Final Order, and does not withdraw such person’s Notice of Dissent prior to the Effective Time.
Dissent Rights
with respect to Notice Shares will terminate and cease to apply to the Dissenting Shareholder if, before full payment is made for the
Notice Shares, the Arrangement in respect of which the Notice of Dissent was sent is abandoned or by its terms will not proceed, the
Arrangement Resolution does not pass, a court permanently enjoins or sets aside the corporate action approved by the Arrangement Resolution,
the Dissenting Shareholder votes in favour of the Arrangement Resolution, or the Dissenting Shareholder withdraws the Notice of Dissent
with SilverCrest’s written consent. If any of these events occur, SilverCrest must return the share certificates representing the
SilverCrest Shares to the Dissenting Shareholder and the Dissenting Shareholder regains the ability to vote and exercise its rights as
a Shareholder.
If a Dissenting
Shareholder fails to strictly comply with the requirements of the Dissent Rights set out in the Interim Order, it will lose its Dissent
Rights, SilverCrest will return to the Dissenting Shareholder the certificates representing the Notice Shares that were delivered to
SilverCrest, if any, and if the Arrangement is completed, that Dissenting Shareholder will be deemed to have participated in the Arrangement
on the same terms as a Shareholder.
The discussion
above is only a summary of the Dissent Rights, which are technical and complex. A Shareholder who intends to exercise Dissent Rights
should carefully consider and comply with the provisions of Sections 237 to 247 of the BCBCA, as modified by the Plan of Arrangement
and Interim Order. Persons who are beneficial holders of SilverCrest Shares registered in the name of an Intermediary such as a broker,
custodian, nominee, other Intermediary, or in some other name, who wish to dissent should be aware that only the registered owner of
such SilverCrest Shares is entitled to dissent.
For greater certainty,
in addition to any other restrictions in the Interim Order and under the BCBCA, none of the following shall be entitled to exercise Dissent
Rights: (i) a holder of any Company Incentive Awards in respect of such holder’s Company Incentive Awards; (ii) Shareholders who
vote or have instructed a proxyholder to vote such SilverCrest Shares in favour of the Arrangement Resolution; and (iii) any other Person
who is not a Registered Shareholder as of the Record Date.
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SilverCrest suggests
that any Shareholder wishing to avail themselves of the Dissent Rights seek their own legal advice as failure to strictly comply with
the requirements set forth in Sections 237 to 247 of the BCBCA, as modified by the Interim Order and the Plan of Arrangement, may result
in the loss of any right of dissent. Dissenting Shareholders should note that the exercise of Dissent Rights can be a complex, time-consuming
and expensive process. For a general summary of certain income tax implications to a Dissenting Shareholder, see “Certain Canadian
Federal Income Tax Considerations” and “Certain United States Federal Income Tax Consequences of the Arrangement”.
MI 61-101
The Company is
a reporting issuer (or its equivalent) in all of the provinces of Canada except Québec, and, accordingly, is subject to MI 61-101.
MI 61-101 is intended to regulate certain transactions to ensure equality of treatment among security holders, generally requiring enhanced
disclosure, approval by a majority of security holders excluding interested parties and/or, in certain instances, independent valuations
and approval and oversight of the transaction by a special committee of independent directors. The protections of MI 61-101 generally
apply to “business combinations” (as defined in MI 61-101) that terminate the interests of security holders without their
consent.
MI 61-101 provides
that, in certain circumstances, where a “related party” (as defined in MI 61-101) of an issuer is entitled to receive a “collateral
benefit” (as defined in MI 61-101) in connection with an arrangement transaction (such as the Arrangement), such transaction may
be considered a “business combination” for the purposes of MI 61-101 and subject to formal valuation and minority approval
requirements. If “minority approval” is required, the Arrangement Resolution must also be approved by a majority of the votes
cast, excluding those votes beneficially owned, or over which control or direction is exercised, by the “related parties”
of the Company who receive a “collateral benefit” in connection with the Arrangement.
A “collateral
benefit”, as defined in MI 61-101, includes any benefit that a related party of the Company (which includes the directors and senior
officers of the Company) is entitled to receive, directly or indirectly, as a consequence of the Arrangement, including, without limitation,
an increase in salary, a lump sum payment, a payment for surrendering securities or other enhancement in benefits related to past or
future services as an employee, director or consultant of the Company. However, such a benefit will not constitute a “collateral
benefit” provided that certain conditions are satisfied.
Under MI 61-101,
a benefit received by a related party of the Company is not considered to be a “collateral benefit” if the benefit is received
solely in connection with the related party’s services as an employee, director or consultant of the Company or an affiliated entity
and (i) the benefit is not conferred for the purpose, in whole or in part, of increasing the value of the consideration paid to the related
party for securities relinquished under the Arrangement, (ii) the conferring of the benefit is not, by its terms, conditional on the
related party supporting the Arrangement in any manner, (iii) full particulars of the benefit are disclosed in disclosure document for
the transaction, and (iv) either (A) at the time the Arrangement was agreed to, the related party and its associated entities beneficially
owned or exercised control or direction over less than 1% of the outstanding SilverCrest Shares (the “De Minimis Exclusion”),
or (B) (x) the related party discloses to an independent committee of the Company the amount of consideration that the related party
expects it will be beneficially entitled to receive, under the terms of the Arrangement, in exchange for the SilverCrest Shares beneficially
owned by the related party, (y) the independent committee, acting in good faith, determines that the value of the benefit, net of any
offsetting costs to the related party, is less than 5% of the value referred to in (B) (x), and (z) the independent committee’s
determination is disclosed in this Circular (the “Independent Committee Exclusion”).
For a description
of the “benefits” that the senior officers may be entitled to receive in connection with the Arrangement, see “The
Arrangement – Interests of Certain Persons in the Arrangement” in this Circular. These “benefits” include
the benefit received as a result of the exchange of SilverCrest Options, the accelerated vesting of the SilverCrest RSUs, SilverCrest
PSUs and SilverCrest DSUs and change of control payments. Such benefits would constitute “collateral benefits” if not otherwise
excluded from the definition of “collateral benefit” as a result of the De Minimis Exclusion or the Independent Committee
Exclusion.
Following disclosure
by each of the directors and senior officers of the number of securities of SilverCrest held by them and the total consideration that
they expect to receive pursuant to the Arrangement, no senior officer of SilverCrest who is receiving a benefit in connection with the
Arrangement will beneficially own or exercise control or direction over more than 1% (calculated in accordance with the provisions of
MI 61-101) of the SilverCrest Shares except for Mr. N. Eric Fier. As such, any benefit received by any director or senior officer, except
for Mr. Fier, is excluded from the definition of “collateral benefit” as a result of the De Minimis Exclusion.
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Mr. N. Eric Fier,
the Chief Executive Officer and a Director of the Company, beneficially owns or exercises control or direction over more than 1% of the
SilverCrest Shares (calculated in accordance with the provisions of MI 61-101) and will receive a benefit as a result of the exchange
of SilverCrest Options, the accelerated vesting of SilverCrest RSUs and SilverCrest PSUs and the change of control payments. Accordingly,
the benefits that Mr. Fier will receive as a result of the completion of the Arrangement constitute “collateral benefits”
if it is not otherwise excluded from the definition of “collateral benefit” as a result of the Independent Committee Exclusion.
The Company has determined it may not rely on the Independent Committee Exclusion with respect to the benefit that will be received by
Mr. Fier, as the value of the benefit Mr. Fier will receive as a result of the Arrangement, net of any offsetting costs to Mr. Fier,
is not less than 5% of the value of the amount of consideration that Mr. Fier expects to be beneficially entitled to receive, under the
terms of the Arrangement, in exchange for the SilverCrest Shares beneficially owned by Mr. Fier. As such, the benefit to be received
by Mr. Fier is a “collateral benefit” for the purposes of MI 61-101 and a simple majority of the votes cast on the Arrangement
Resolution by Shareholders, excluding the votes for SilverCrest Shares held or controlled by persons described in items (a) through (d)
of Section 8.1(2) of MI 61-101 is required. In this regard, any SilverCrest Shares beneficially owned, or over which control or
direction is exercised, directly or indirectly, by Mr. Fier must be excluded for purposes of determining whether minority approval of
the Arrangement Resolution has been obtained. As of the Record Date, Mr. Fier held, or exercised control or direction over, directly
or indirectly, 2,064,075 SilverCrest Shares. As a result, a total of 2,064,075 SilverCrest Shares (representing approximately 1.4% of
the issued and outstanding SilverCrest Shares) will be excluded from the “minority approval” vote conducted pursuant to MI
61-101.
Formal
and Prior Valuations
The Company
is not required to obtain a formal valuation under MI 61-101 as no “interested party” (as defined in MI 61-101) of the
Company is, as a consequence of the Arrangement, directly or indirectly, acquiring the Company or its business or combining with
Coeur, and neither the Arrangement nor the transactions contemplated thereunder is a “related party transaction” (as
defined in MI 61-101) for which the Company would be required to obtain a formal valuation. Furthermore, neither the Company
nor any director or senior officer of the Company, after reasonably inquiry, has knowledge of any “prior valuation”
(as defined in MI 61-101) in respect of the Company that has been made in the 24 months before the date of this
Circular.
Prior Offers
The Company has
not received any bona fide offers (as contemplated in MI 61-101) during the 24 months preceding the entry into of the Arrangement
Agreement.
Stock Exchange
Delisting and Reporting Issuer Status
The SilverCrest
Shares will be delisted from the TSX and NYSE American as soon as practicable following the completion of the Arrangement. Following
the Effective Date, it is expected that Coeur will cause the Company to apply to cease to be a reporting issuer under the securities
legislation of each of the provinces in Canada under which it is currently a reporting issuer (or equivalent) or take or cause to be
taken such other measures as may be appropriate to ensure that the Company is not required to prepare and file continuous disclosure
documents.
Exchange Approvals
The Coeur Shares
are listed and posted for trading on the NYSE. It is a condition of the Arrangement that the NYSE has approved for listing the Coeur
Shares to be issued or made issuable in connection with the Arrangement (subject only to official notice of issuance).
The completion
of the Arrangement is subject to the conditional approval of the TSX. On December 12, 2024, the TSX conditionally approved the Arrangement
and the delisting of the SilverCrest Shares following the closing of the Arrangement, subject to the delivery of certain closing documentation.
COFECE Approval
Under the Mexican
Antitrust Law, there are certain monetary thresholds which trigger the obligation of economic agents to notify concentrations with COFECE
and be approved before they are consummated. Transactions subject to the COFECE authorization that close before obtaining such authorization
shall have no legal effect, and the transaction shall be considered null and void. Parties may condition the closing of a transaction
on obtaining COFECE’s authorization.
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For purposes
of the Mexican Antitrust Law, “concentration” is defined as any merger, acquisition of control or any transaction the result
of which is the merger of corporations, companies, associations, shares, equity interests, trusts or assets in general, executed among
competitors, suppliers, clients or any other economic agent.
In certain cases,
an expedited review process may be available from COFECE. However, the Arrangement does not qualify for this expedited process.
The steps to
obtain the COFECE authorization, in accordance with Article 89 and 90 of the Mexican Antitrust Law, are substantially as follows:
| (1) | | The
parties must submit the pre-merger notice and all relevant accompanying documents before
COFECE. |
| | | |
| (2) | | If,
in COFECE’s opinion, the information delivered by the parties is incomplete (which
opinion is discretionary), COFECE may request, within 10 business days following the filing,
the parties to provide any information and documentation that COFECE considers is missing
pursuant to Article 89 of the Mexican Antirust Law ( “Request for Basic Information”). |
| | | |
| (3) | | Thereafter,
the parties have 10 business days to submit any missing information to COFECE. The parties
may request an extension to provide a response to the Request for Basic Information. |
| (4) | | If
the parties fail to timely submit the complete requested information, COFECE will declare,
within 10 business days, that the pre-merger notice was not duly filed, and the pre-merger
notice will be dismissed. This would require the parties to redo the process all over again. |
| | | |
| (5) | | Once
the filing is deemed to include all necessary documents and information, COFECE may request,
in its sole discretion, additional information within 15 business days thereof (“Request
for Additional Information”). |
| | | |
| (6) | | The
parties must submit any additional information requested by COFECE within 15 business days
following receipt of the Request for Additional Information. The parties may request an extension
to provide a response to the Request for Additional Information. |
| | | |
| (7) | | If
COFECE believes that the transaction poses any antitrust concerns, it shall notify the parties
thereof at least 10 business days prior to the date on which the matter will be listed for
discussion by COFECE’s Plenum. The parties shall have 10 business days to submit remedies
or actions to address COFECE’s concerns. |
| | | |
| (8) | | If
the parties identify from the beginning that the transaction may pose antitrust concerns,
the parties may include proposed remedies or actions that favor free market and open economic
competition, as part of their initial notice (e.g., excluding certain regions or certain
business segments from the scope of the proposed transaction). Prior to issuing its decision,
COFECE may also request the parties to submit for its approval such remedies or actions.
In any case, if the proposed remedies or actions are submitted during the review process,
all time periods for processing the filing will start again as of the date of submission
of the proposed mitigating actions. |
| | | |
| (9) | | COFECE
shall issue its decision no later than 60 business days following the date when the submission
is deemed complete. That is, (i) as of the date of the submission of the pre-merger notice
in case no requests for information are issued; or (ii) the date on which the parties respond
to the Request for Basic Information and no Request for Additional Information is issued;
or (iii) the date on which the parties respond to the Request for Additional Information.
This term may be extended for 40 additional business days in complex transactions. Note that
COFECE has discretionary authority to request additional documentation as many times as it
deems necessary to complete its analysis. |
| | | |
| (10) | | If
COFECE does not issue a formal decision within such 60 business days and the review period
was not extended, the transaction will be deemed authorized. However, the parties may request
a formal confirmation from COFECE. |
| | | |
| (11) | | COFECE
may authorize, object or condition the transaction to certain remedies or actions. |
| | | |
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| (12) | | The
parties must close the transaction within six months from the issuance of COFECE’s
decision (term that can be extended for up to six additional months in justified cases, prior
request) and must inform COFECE of the closing within 30 business days thereafter. |
On November 8,
2024, the Parties filed a notification to COFECE with respect to the transactions contemplated by the Arrangement Agreement. As of the
date of this Circular, the review of the transactions contemplated by the Arrangement Agreement by COFECE is ongoing and the COFECE Approval
required under the Arrangement Agreement has not yet been obtained. The Parties note that there may be changes to the above in accordance
with reforms to the constitution and secondary laws that are being carried out in the Congress of Mexico.
Regulatory Matters
and Securities Law Matters
Regulatory
approvals in respect of the Arrangement include, but are not limited to, (i) in relation to SilverCrest, the conditional approval of
the TSX in respect of the Arrangement, the SilverCrest Securityholder Approval and the COFECE Approval, and (ii) in relation to
Coeur, the approval of the NYSE for the issuance and listing of the Consideration Shares to be issued pursuant to the Arrangement
and the Coeur Shares issuable on the exercise of the Replacement Options, the Coeur Stockholder Approvals and the COFECE Approval.
Other than the foregoing approvals, SilverCrest is not aware of any material approval, consent or other action by any federal,
provincial, state or foreign government or any administrative or regulatory agency that would be required to be obtained in order to
complete the Arrangement. In the event that any such approvals or consents are determined to be required, such approvals or consents
will be sought. Any such additional requirements could delay the
Effective Date or prevent the completion of the Arrangement. While there can be no assurance that any regulatory consents or
approvals that are determined to be required will be obtained, SilverCrest currently anticipates that any such consents and
approvals that are determined to be required will have been obtained or otherwise resolved by the Effective Date. Subject to receipt
of the SilverCrest Securityholder Approval at the Meeting, the Coeur Stockholder Approvals at the Coeur Meeting, the Final Order and
the COFECE Approval, and the satisfaction or waiver of all other conditions specified in the Arrangement Agreement, the Effective
Date is expected to be late in the first quarter of 2025.
Canadian
Securities Law Matters
Each Shareholder
is urged to consult with their professional advisors to determine the Canadian conditions and restrictions applicable to trades in the
Coeur Shares issued pursuant to the Arrangement.
Status under
Canadian Securities Laws
SilverCrest is
a reporting issuer in all of the provinces of Canada except Québec. The SilverCrest Shares currently trade on the TSX and the
NYSE American. After the Arrangement, SilverCrest will be a wholly-owned subsidiary of Coeur, the SilverCrest Shares will be delisted
from the TSX and the NYSE American (delisting is anticipated to be effective one or two business days following the Effective Date) and
Coeur expects to apply to the applicable Canadian Securities Authorities to have SilverCrest cease to be a reporting issuer.
Distribution
and Resale of Coeur Shares under Canadian Securities Laws
The distribution
of the Coeur Shares pursuant to the Arrangement will constitute a distribution of securities which is exempt from the prospectus requirements
of Canadian Securities Laws. The Coeur Shares received pursuant to the Arrangement will not be legended and may be resold through registered
dealers in each of the provinces of Canada provided that (i) the trade is not a “control distribution” as defined National
Instrument 45-102 – Resale of Securities of the Canadian Securities Administrators, (ii) no unusual effort is made to prepare
the market or to create a demand for the Coeur Shares, as the case may be, (iii) no extraordinary commission or consideration is paid
to a person or company in respect of such sale, and (iv) if the selling security holder is an insider or officer of Coeur, the selling
security holder has no reasonable grounds to believe that Coeur is in default of Canadian Securities Laws.
United
States Securities Law Matters
The following
discussion is a general overview of certain requirements of U.S. Securities Laws that may be applicable to U.S. Securityholders. All
U.S. Securityholders are urged to consult with their own legal counsel to ensure that any subsequent resale of Coeur Shares to be received
in exchange for their SilverCrest Shares pursuant to the Arrangement, or Coeur Shares to be received upon exercise of the Replacement
Options, complies with applicable U.S. Securities Laws.
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The following
discussion does not address the Canadian Securities Laws that will apply to the issue and resale of Coeur Shares within Canada by Securityholders
in the United States. Securityholders in the United States reselling their Coeur Shares in Canada must comply with Canadian Securities
Laws, as outlined elsewhere in this Circular.
Exemption
from the Registration Requirements of the U.S. Securities Act
The Coeur Shares
and the Replacement Options to be issued to Securityholders pursuant to the Arrangement have not been and will not be registered
under the U.S. Securities Act or the Securities Laws of any state of the United States and will be issued and exchanged in reliance
upon Section 3(a)(10) of the U.S. Securities Act and exemptions provided under the Securities Laws of each state of the United
States in which Securityholders reside. Section 3(a)(10) of the U.S. Securities Act exempts the issuance of any securities issued in
exchange for one or more bona fide outstanding securities from the registration requirements under the U.S. Securities Act
where the terms and conditions of the issuance and exchange of such securities have been approved by a court of competent
jurisdiction that is expressly authorized by law to grant such approval, after a hearing upon the substantive and procedural
fairness of the terms and conditions of such issuance and exchange at which all persons to whom it is proposed to issue the
securities have the right to appear and receive timely and adequate notice thereof. The Court is authorized to conduct a hearing at
which the substantive and procedural fairness of the terms and conditions of the Arrangement will be considered. Accordingly,
the Final Order will, if granted, constitute a basis for the exemption from the registration requirements of the U.S. Securities Act
provided by Section 3(a)(10) of the U.S. Securities Act with respect to the Coeur Shares and the Replacement Options to be issued to
Securityholders pursuant to the Arrangement.
Resales of
Coeur Shares After the Effective Date
The Coeur Shares
to be received by Shareholders in exchange for their SilverCrest Shares pursuant to the Arrangement (which, for avoidance of doubt, does
not include Coeur Shares issuable upon exercise of the Replacement Options), will be freely tradeable under the U.S. Securities Act,
except by persons who are “affiliates” (as defined in Rule 144 under the U.S. Securities Act) of Coeur after the Effective
Date, or were “affiliates” of Coeur within 90 days prior to the Effective Date. Persons who may be deemed to be “affiliates”
of an issuer include individuals or entities that directly or indirectly through one or more intermediaries control, are controlled by,
or are under common control with, the issuer, whether through the ownership of voting securities, by contract, or otherwise, and generally
include executive officers and directors of the issuer as well as principal shareholders of the issuer. Typically, persons who are executive
officers, directors or 10% or greater shareholders of an issuer are considered to be its “affiliates”.
Any resale of
Coeur Shares by such a Coeur “affiliate” or person who has been a Coeur “affiliate” within 90 days prior to the
Effective Date, will be subject to certain restrictions on resale imposed by the U.S. Securities Act, and may not be resold in the absence
of registration under the U.S. Securities Act or an exemption from such registration, if available, such as the exemption provided under
Rule 144.
Resales by
Affiliates Pursuant to Rule 144
In general, pursuant
to Rule 144, persons who are “affiliates” (as defined in Rule 144) of Coeur after the Effective Date, or were “affiliates”
of Coeur within 90 days prior to the Effective Date, will be entitled to sell, during any three-month period, those Coeur Shares that
they receive pursuant to the Arrangement, provided that the number of such securities sold does not exceed the greater of one percent
of the then outstanding securities of such class or, if such securities are listed on a United States securities exchange and/or reported
through the automated quotation system of a U.S. registered securities association, the average weekly trading volume of such securities
during the four calendar week period preceding the date of sale, subject to specified restrictions on manner of sale requirements, aggregation
rules, notice filing requirements and the availability of current public information about the issuer required under Rule 144. Persons
who are “affiliates” after the Arrangement will continue to be subject to the resale restrictions described in this paragraph
for so long as they continue to be “affiliates” of Coeur.
Exercise of
Replacement Options
The exemption
from the registration requirements of the U.S. Securities Act provided by Section 3(a)(10) of the U.S. Securities Act does not exempt
the issuance of securities upon the exercise of the Replacement Options. As a result, the Coeur Shares issuable upon exercise of the
Replacement Options after the Effective Date may not be issued in reliance upon Section 3(a)(10) of the U.S. Securities Act and the Replacement
Options may only be exercised pursuant to an available exemption from the registration requirements of the
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U.S. Securities Act and applicable
state Securities Laws or pursuant to a registration statement under the U.S. Securities Act. Prior to the issuance of any Coeur Shares
pursuant to any such exercise of Replacement Options after the Effective Time, if any, Coeur may require evidence (which may include
an opinion of counsel of recognized standing) reasonably satisfactory to Coeur to the effect that the issuance of such Coeur Shares does
not require registration under the U.S. Securities Act or applicable state securities laws.
Coeur Shares received
upon exercise of the Replacement Options after the Effective Time, if any, by holders in the United States will be “restricted
securities”, as such term is defined in Rule 144(a)(3) under the U.S. Securities Act, and may not be resold unless such securities
are registered under the U.S. Securities Act and all applicable state securities laws or unless an exemption from such registration requirements
is available.
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THE
ARRANGEMENT AGREEMENT
The summary
of the material provisions of the Arrangement Agreement below and elsewhere in this Circular is qualified in its entirety by reference
to the Arrangement Agreement, a copy of which is available under the Company’s profile on SEDAR+ at www.sedarplus.ca and on EDGAR
at www.sec.gov. This summary may not contain all of the information about the Arrangement Agreement that is important to you.
We urge you to carefully read the Arrangement Agreement in its entirety, including all of its schedules, as it is the legal document
governing the Arrangement. The Arrangement Agreement contains representations and warranties that SilverCrest, Coeur and Coeur Canadian
Sub have made to each other as of specific dates. The assertions embodied in the representations and warranties in the Arrangement Agreement
were made solely for purposes of the Arrangement Agreement and the arrangement and agreements contemplated thereby among SilverCrest
and Coeur, and may be subject to important qualifications and limitations agreed to by SilverCrest and Coeur in connection with negotiating
the terms thereof. The representations and warranties may also be subject to a contractual standard of materiality different from those
generally applicable to shareholders and reports and documents filed with the Canadian Securities Authorities or the SEC, as applicable,
and the assertions embodied in the representations and warranties contained in the Arrangement Agreement (and summarized below) are qualified
by information in the Company Disclosure Letter or the Coeur Disclosure Letter, as applicable, and by certain information contained in
certain of SilverCrest’s and Coeur’s public filings with the Canadian Securities Authorities or the SEC, as applicable. The
Company Disclosure Letter, Coeur Disclosure Letter and filings with the Canadian Securities Authorities or the SEC, as applicable, contain
information that modifies, qualifies and creates exceptions to the representations and warranties set forth in the Arrangement Agreement.
In addition, information concerning the subject matter of the representations and warranties may have changed or may change after October
3, 2024 and subsequent developments or new information qualifying a representation or warranty may have been included in this Circular.
In addition, if specific material facts arise that contradict the representations and warranties in the Arrangement Agreement, Coeur
or SilverCrest, as applicable, will disclose those material facts in the public filings that it makes with the Canadian Securities Authorities
or the SEC, as applicable, in accordance with, and to the extent required by, applicable Law. Accordingly, the representations and warranties
in the Arrangement Agreement and their description in this Circular should not be read alone, but instead should be read in conjunction
with the other information contained in the reports, statements and filings SilverCrest and Coeur publicly file with the Canadian Securities
Authorities or the SEC, as applicable. For more information, see “Other Information – Additional Information”.
The Arrangement
On October 3,
2024, the Parties entered into the Arrangement Agreement. The Arrangement Agreement provides that at the Effective Time, Coeur Canadian
Sub will acquire all of the issued and outstanding SilverCrest Shares in exchange for the Consideration, with SilverCrest continuing
as a wholly-owned subsidiary of Coeur.
The
Arrangement will be implemented by way of a plan of arrangement under the BCBCA and requires approval by: (A) the Court; and (B) at least
(i) 66⅔% of the votes cast by Shareholders present in person or represented by proxy and entitled to vote at the Meeting; (ii) 66⅔%
of the votes cast by Securityholders, voting together as a single class, present in person or represented by proxy and entitled to vote
at the Meeting, with Shareholders and Optionholders being entitled to one vote for each SilverCrest Share and SilverCrest Option, respectively;
and (iii) a simple majority of the votes cast by Shareholders present in person or represented by proxy and entitled to vote at
the Meeting, excluding the Excluded Shares for purposes of MI 61-101.
If the Final
Order is granted, and all other conditions to completion of the Arrangement, as set out in the Arrangement Agreement, are satisfied or
waived (to the extent that such conditions are capable of being satisfied prior to the Effective Date and, if waived, are not prohibited
from being waived), the Arrangement will become effective at the Effective Time in accordance with the terms of the Plan of Arrangement.
Consideration
At the Effective
Time, each Shareholder (other than SilverCrest Shares held by Dissenting Shareholders) will receive consideration of 1.6022 Coeur Shares
for each SilverCrest Share they hold.
No
fractional Consideration Shares will be issued as part of the Arrangement. Where the aggregate number of Consideration Shares to be
issued to a Shareholder as Consideration would result in a fractional Consideration Share being issuable, such fractional
Consideration Share shall be rounded up to the nearest whole Consideration Share in the event that a Shareholder is entitled to a
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fractional share representing 0.5 or more of a Consideration Share, and shall be rounded down to the nearest whole Consideration
Share in the event that a Shareholder is entitled to a fractional share representing less than 0.5 of a Consideration Share.
Treatment of Company
Incentive Awards
Company Incentive
Awards that are outstanding immediately prior to the Effective Time will be treated in accordance with the Arrangement Agreement, the
Plan of Arrangement and the applicable Company Equity Incentive Plan.
SilverCrest
Options
At the Effective
Time, each outstanding SilverCrest Option immediately prior to the Effective Time will be automatically exchanged for a Replacement Option.
The Replacement Option will allow the holder to purchase Coeur Shares equal to the product of (i) the number of SilverCrest Shares subject
to the SilverCrest Option immediately before the Effective Time multiplied by (ii) the Exchange Ratio (rounded down to the nearest whole
number of Coeur Shares). The exercise price per Coeur Share will be equal to the quotient of (x) the exercise price per SilverCrest Share
underlying the exchanged SilverCrest Option immediately prior to the Effective Time divided by (y) the Exchange Ratio (rounded up to
the nearest whole cent). It is intended that (i) the provisions of Subsection 7(1.4) of the Tax Act apply to the aforesaid exchange of
options and (ii) such exchange of options be treated as other than the grant of a new stock right or a change in the form of payment
pursuant to Section 1.409A-1(b)(5)(v)(D) of the U.S. Treasury Regulations. Accordingly, if required, the exercise price of a Replacement
Option will be adjusted such that the In-The-Money-Value of the Replacement Option immediately after the exchange does not exceed the
In-The-Money-value of the SilverCrest Option for which it was exchanged immediately prior to the exchange. The terms of each Replacement
Option, including expiration and exercise conditions, will mirror the terms of the original SilverCrest Option.
SilverCrest
RSUs, SilverCrest PSUs and SilverCrest DSUs
At the Effective
Time, on the terms and subject to the conditions of the Arrangement Agreement and the applicable Company Equity Incentive Plan, each
outstanding (i) SilverCrest RSU granted pursuant to the Company Share Unit Plan; (ii) SilverCrest PSU granted pursuant to the Company
Share Unit Plan; (iii) SilverCrest DSU granted pursuant to the Company Share Unit Plan or the Company DSU Plan, as applicable, in each
case, will become fully vested, and the holder thereof will receive a cash payment to be calculated in accordance with the terms of the
applicable Company Equity Incentive Plan.
Efforts to Obtain
Required SilverCrest Securityholder Approval
SilverCrest is
required to take all action necessary in accordance with the Interim Order, applicable Laws and its constating documents to duly call,
give notice of, convene and conduct the Meeting to obtain the SilverCrest Securityholder Approval, to be held as promptly as reasonably
practicable following the clearance of the Coeur Proxy Statement by the SEC (and, in any event, will use reasonable best efforts to convene
the Meeting within 35 days of the SEC clearance).
Notwithstanding
the foregoing, SilverCrest will be required to adjourn or postpone the Meeting if required by applicable Law or a Governmental Entity
or as required for quorum purposes, and may adjourn the Meeting: (i) if SilverCrest reasonably determines in good faith that the requisite
SilverCrest Securityholder Approval is unlikely to be obtained; (ii) if the Board determines in good faith that it is necessary or appropriate
to postpone or adjourn the Meeting in order to give Securityholders sufficient time to evaluate any information or disclosure that SilverCrest
has sent or otherwise made available to such holders by issuing a press release, filing materials with Canadian Securities Authorities
or otherwise; (iii) if a notice of termination of the Arrangement Agreement is delivered by a Party prior to the date of the Meeting;
or (iv) with Coeur’s prior written consent, and in each case, subject to the restrictions and time periods set out in the Arrangement
Agreement.
Unless there
is a Company Change in Recommendation as permitted under the Arrangement Agreement, SilverCrest will include in this Circular the Board
Recommendation to the Securityholders that they vote FOR the Arrangement Resolution.
Efforts to Obtain
Required Coeur Stockholder Approvals
Coeur is required
to take all action necessary in accordance with applicable Laws and its constating documents to duly call, give notice of, convene and
conduct the Coeur Meeting, to be held as promptly as reasonably practicable following the clearance of the Coeur
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Proxy Statement by the
SEC (and, in any event, will use reasonable best efforts to convene the Coeur Meeting within 35 days of receipt of the SEC clearance).
Notwithstanding the forgoing, Coeur will be required to adjourn or postpone the Coeur Meeting if required by applicable Law or a Governmental
Entity or as required for quorum purposes, and may adjourn the Coeur Meeting: (i) if Coeur reasonably determines in good faith that the
requisite Coeur Stockholder Approvals are unlikely to be obtained; (ii) if the Coeur Board determines that it is necessary or appropriate
to postpone or adjourn the Coeur Meeting in order to give Coeur Stockholders sufficient time to evaluate any information or disclosure
that Coeur has sent or otherwise made available to such holders by issuing a press release, filing materials with the SEC or otherwise;
(iii) if a notice of termination of the Arrangement Agreement is delivered by a Party prior to the date of the Coeur Meeting; or (iv)
with SilverCrest’s prior written consent, and in each case, subject to the restrictions and time periods set out in the Arrangement
Agreement.
Unless there
is a Coeur Change in Recommendation as permitted under the Arrangement Agreement, Coeur will include in the Coeur Proxy Statement the
Coeur Board Recommendation to the Coeur Stockholders that they vote in favour of the Coeur Stock Issuance and the Coeur Charter Amendment.
Final Court Approval
After the Interim
Order of the Court has been obtained, the Securityholders have approved the Arrangement and the Coeur Stockholders have approved the
Coeur Stock Issuance and the Coeur Charter Amendment, SilverCrest is required to (i) diligently pursue and take all steps necessary to
submit the Arrangement before the Court as promptly as reasonably practicable, and (ii) diligently pursue an application for the Final
Order pursuant to Section 291 of the BCBCA as reasonably practicable but, in any event, within four business days after the SilverCrest
Securityholder Approval is obtained. The Court will consider, among other things, the procedural and substantive fairness of the Arrangement
to the Securityholders.
Conditions to Closing
Mutual
Conditions Precedent
The completion
of the Arrangement is subject to satisfaction of the following conditions precedent which may only be waived with the mutual consent
of Coeur and SilverCrest:
| (a) | SilverCrest
Securityholder Approval. The Arrangement Resolution shall have been approved and adopted
by the Securityholders at the Meeting in accordance with the Interim Order. |
| (b) | Interim
and Final Order. The Interim Order and the Final Order shall each have been obtained
on terms consistent with the Arrangement Agreement, and shall not have been set aside or
modified in a manner unacceptable to either SilverCrest or Coeur, each acting reasonably,
on appeal or otherwise. |
| (c) | Coeur
Stockholder Approvals. The requisite approvals of the Coeur Stock Issuance and the Coeur
Charter Amendment by the Coeur Stockholders shall have been obtained in accordance with the
rules of the NYSE (with respect to the Coeur Stock Issuance) and the DGCL (with respect to
the Coeur Charter Amendment) at the Coeur Meeting. |
| (d) | Coeur
Charter Amendment. The Coeur Charter Amendment shall have been duly filed with the Secretary
of State of the State of Delaware and be in full force and effect. |
| (e) | Illegality.
No law is in effect that makes the consummation of the Arrangement illegal or otherwise prohibits
or enjoins SilverCrest or Coeur from consummating the Arrangement (including, any law prohibiting
the issuance of the Coeur Shares or the Replacement Option pursuant to the Arrangement Agreement
without an exemption from the registration requirements of the U.S. Securities Act pursuant
to Section 3(a)(10)). |
| (f) | Exempt
from Prospectus or Registration Requirements. The distribution of the Consideration Shares
and the Replacement Options shall be exempt from the prospectus and registration requirements
of applicable Canadian Securities Laws, either by virtue of exemptive relief from the securities
regulatory authorities of each of the provinces and territories of Canada, or by virtue of
applicable exemptions under Canadian Securities Laws, and shall not be subject to resale
restrictions under applicable Canadian Securities Laws. |
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| (g) | Listing
of Consideration Shares. The Consideration Shares to be issued pursuant to the Arrangement
shall have been approved for listing on the NYSE (subject only to official notice of issuance). |
| (h) | COFECE
Approval. The COFECE Approval shall have been obtained and shall not have been modified
or rescinded. |
| (i) | No
Termination. The Arrangement Agreement shall not have been terminated in accordance with
its terms. |
Conditions
in Favour of Coeur
The obligation
of Coeur to complete the Arrangement is subject to the fulfillment of each of the following conditions precedent on or before the Effective
Time (each of which is for the exclusive benefit of Coeur and may be waived by Coeur, in whole or in part, at any time):
| (a) | Performance
of Covenants. All covenants of SilverCrest under the Arrangement Agreement to be performed
on or before the Effective Time shall have been duly performed by SilverCrest in all material
respects and Coeur shall have received a certificate of SilverCrest addressed to Coeur and
dated the Effective Date, signed on behalf of SilverCrest by a senior executive officer of
SilverCrest (on SilverCrest’s behalf and without personal liability), confirming the
same as of the Effective Date. |
| (b) | Representations
and Warranties. (i) The representations and warranties of SilverCrest set forth in the
Arrangement Agreement (other than as contemplated in clauses (ii) and (iii)) shall be true
and correct in all respects, without regard to any materiality qualifications contained in
them, as of the date of the Arrangement Agreement and as of the Effective Time as though
made on and as of such date or time (except for representations and warranties made as of
a specified date, the accuracy of which shall be determined as of that specified date), except
where the failure or failures of all such representations and warranties to be so true and
correct in all respects would not reasonably be expected to have a Company Material Adverse
Effect; (ii) the representations and warranties of SilverCrest relating to organization and
qualification, authority relative to the Arrangement Agreement, no conflict and absence of
a Company Material Adverse Effect shall be true and correct in all respects as of the date
of the Arrangement Agreement and as of the Effective Time as though made on and as of such
date or time, and (iii) the representations and warranties of SilverCrest relating to Subsidiaries,
capitalization and listing and brokers shall be true and correct in all respects (except
for de minimis inaccuracies and as a result of transactions, changes, conditions,
events or circumstances permitted under the Arrangement Agreement) as of the date of the
Arrangement Agreement and as of the Effective Time as though made on and as of such date
or time (except for representations and warranties made as of a specified date, the accuracy
of which shall be determined as of that specified date), and Coeur shall have received a
certificate of SilverCrest addressed to Coeur and dated the Effective Date, signed on behalf
of SilverCrest by a senior executive officer of SilverCrest (on SilverCrest’s behalf
and without personal liability), confirming the same. |
| (c) | No
Company Material Adverse Effect. Between the date of the Arrangement Agreement and the
Effective Time, there shall not have occurred a Company Material Adverse Effect that is continuing
as of the Effective Time. |
| (d) | Dissent
Rights. Dissent Rights shall not have been exercised (or, if exercised, not withdrawn)
with respect to more than 5% of the issued and outstanding SilverCrest Shares. |
Conditions
in Favour of SilverCrest
The obligation
of SilverCrest to complete the Arrangement is subject to the fulfillment of each of the following conditions precedent on or before the
Effective Time (each of which is for the exclusive benefit of SilverCrest and may be waived by SilverCrest, in whole or in part, at any
time):
| (a) | Performance
of Covenants. All covenants of Coeur under the Arrangement Agreement to be performed
on or before the Effective Time shall have been duly performed by Coeur in all material respects
and SilverCrest shall have received a certificate of Coeur, addressed to SilverCrest and
dated the Effective Date, signed on behalf of Coeur by a senior executive officer (on Coeur’s
behalf and without personal liability), confirming the same as of the Effective Date. |
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| (b) | Representations
and Warranties. (i) the representations and warranties of Coeur set forth in the Arrangement
Agreement (other than as contemplated in clauses (ii) and (iii)) shall be true and correct
in all respects, without regard to any materiality qualifications contained in them, as of
the date of the Arrangement Agreement and as of the Effective Time as though made on and
as of such date or time (except for representations and warranties made as of a specified
date, the accuracy of which shall be determined as of that specified date), except where
the failure or failures of all such representations and warranties to be so true and correct
in all respects would not reasonably be expected to have a Coeur Material Adverse Effect;
(ii) the representations and warranties of Coeur related to organization and qualification,
authority relative to the Arrangement Agreement, no conflict and absence of a Coeur Material
Adverse Effect shall be true and correct in all respects as of the date of the Arrangement
Agreement and as of the Effective Time as though made on and as of such date or time, and
(iii) the representations and warranties of Coeur relating to Subsidiaries, capitalization
and listing and brokers shall be true and correct in all respects (except for de minimis
inaccuracies and as a result of transactions, changes, conditions, events or circumstances
permitted under the Arrangement Agreement) as of the date of the Arrangement Agreement and
as of the Effective Time as though made on and as of such date or time (except for representations
and warranties made as of a specified date, the accuracy of which shall be determined as
of that specified date), and SilverCrest shall have received a certificate of Coeur addressed
to SilverCrest and dated the Effective Date, signed on behalf of Coeur by a senior executive
officer of Coeur (on Coeur’s behalf and without personal liability), confirming the
same. |
| (c) | Payment
of Consideration. Coeur shall have deposited, or caused to be deposited, with the Depositary
sufficient Coeur Shares to satisfy its obligations under the Arrangement Agreement, and the
Depositary shall have confirmed to SilverCrest its receipt of such Coeur Shares. |
| (d) | No
Coeur Material Adverse Effect. Between the date of the Arrangement Agreement and the
Effective Time, there shall not have occurred a Coeur Material Adverse Effect that is continuing
as of the Effective Time. |
| (e) | SilverCrest
Director Nominees’ Appointment. The Company Director Nominees (to the extent they
have consented to their appointment) shall have been appointed to the Coeur Board to be effective
as of the Effective Time. |
Representations
and Warranties
The Arrangement
Agreement contains certain representations and warranties made by Coeur, SilverCrest and Coeur Canadian Sub, in each case of a nature
customary for transactions of this type. The representations and warranties were made solely for the purposes of the Arrangement Agreement
and, in some cases, are subject to important qualifications, limitations and exceptions agreed to by SilverCrest and Coeur in connection
with negotiating the Arrangement Agreement. The representations and warranties may also be subject to a contractual standard of materiality
different from those generally applicable to shareholders and reports and documents publicly filed by Coeur or SilverCrest. Accordingly,
the Securityholders and the Coeur Stockholders should not rely on the representations and warranties as characterizations of the actual
state of facts, since they are also modified, by the Company Disclosure Letter and the Coeur Disclosure Letter. The Company Disclosure
Letter and the Coeur Disclosure Letter contain information that has been included in the respective Party’s general prior public
disclosures, as well as potential additional non-public information. Moreover, information concerning the subject matter of the representations
and warranties may have changed since the date of the Arrangement Agreement, which subsequent information may or may not be fully reflected
in the public record.
The
representations and warranties of each of SilverCrest, Coeur and Coeur Canadian Sub relate to the following matters: organization
and qualification; authority relative to the Arrangement Agreement; no conflict, required filings and consent; Subsidiaries;
compliance with laws and constating documents; authorizations; capitalization and listing; shareholder and similar agreements;
reporting issuer status; reports; stock exchange matters; financial statements; no undisclosed liabilities; interest in properties
and mineral rights; mineral reserves and resources; scientific and technical information; employment matters; absence of
certain changes or events; litigation; indigenous claims; community relations; no expropriation; taxes; insurance; non-arm’s
length transactions; employee benefit plans; environmental matters; material contracts; whistleblower reporting; restrictions on
business activities; brokers; corrupt practices legislation; sanctions; modern slavery laws; Competition Act (Canada);
bankruptcy; and privacy and security.
In addition to
the foregoing representations and warranties, SilverCrest has provided additional representations and warranties to Coeur and Coeur Canadian
Sub with respect to auditors; personal property; intellectual property; books and records; and standstill agreements, and Coeur and Coeur
Canadian Sub have provided additional representations and warranties to SilverCrest with respect to the Investment Canada Act (Canada)
and the absence of applicable anti-takeover statutes.
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Covenants
Covenants
Relating to the Arrangement
The
Arrangement Agreement contains customary negative and affirmative covenants of SilverCrest and Coeur. Pursuant to the Arrangement Agreement,
each of SilverCrest and Coeur has covenanted that it shall and shall cause its Subsidiaries to perform all obligations required to be
performed by the Party or any of its Subsidiaries under the Arrangement, cooperate with the other Party in connection with the Arrangement,
and do all such other acts and things as may be reasonably necessary or desirable in order to consummate and make effective the transactions
contemplated in the Arrangement Agreement, including, among other things: (a) use commercially reasonable efforts to effect all necessary
registrations, filings and submissions of information required by Governmental Entities; (b) use commercially reasonable efforts to defend
all lawsuits or other legal, regulatory or other proceedings against the other party challenging or affecting the Arrangement Agreement
or the consummation of the transactions contemplated thereby; (c) use commercially reasonable efforts to satisfy all conditions precedent
to the Arrangement Agreement and take all steps set forth in the Interim Order and the Final Order applicable to it and comply promptly
with all requirements imposed by law on it or its Subsidiaries with respect to the Arrangement Agreement or the Arrangement; (d) use
its commercially reasonable efforts to carry out all actions necessary to ensure the availability of the exemption from registration
under Section 3(a)(10) of the U.S. Securities Act and applicable U.S. state securities laws; (e) not take any action, or refrain from
taking any commercially reasonable action, or permit any action to be taken or not taken, which is inconsistent with the Arrangement
Agreement or which would reasonably be expected to prevent, materially delay or otherwise impede the consummation of the Arrangement
or the transactions contemplated by the Arrangement Agreement; and (f) promptly notify the other Party of (i) any Company Material
Adverse Effect or Coeur Material Adverse Effect, as applicable, or any change, effect, event, occurrence or state of facts or circumstance
that would reasonably be expected to have, individually or in the aggregate, a Company Material Adverse Effect or Coeur Material Adverse
Effect, as applicable, (ii) any notice or other communication from any person alleging that a consent (or waiver, permit, exemption,
order, approval, agreement, amendment or confirmation) of such person (or another person) is required in connection with the Arrangement
Agreement or the Arrangement, or (iii) any material proceedings commenced or, to the knowledge of Coeur or SilverCrest, as applicable,
threatened against, relating to or involving or otherwise affecting Coeur or SilverCrest or any of their respective Subsidiaries, as
applicable, in connection with the Arrangement Agreement or the Arrangement. SilverCrest has covenanted to give Coeur a reasonable opportunity
to participate in the defense or settlement of any substantive shareholder litigation against SilverCrest or its directors or officers
relating to the Arrangement, and no such settlement (to the extent a material monetary amount is involved) shall be agreed to without
the prior written consent of Coeur, which consent shall not be unreasonably withheld, conditioned or delayed.
Covenants
relating to General Conduct of Business
The
Arrangement Agreement also contains customary covenants of SilverCrest and Coeur pertaining to the conduct of their respective businesses,
including with respect to, among other things, corporate matters, issuing shares or other equity, distributions, dispositions and acquisitions,
capital expenditures, preservation of mineral rights and properties and indebtedness, and in the case of SilverCrest, employment and
compensation arrangements, material contracts, maintenance of insurance policies and taxes.
Covenants
Specific to SilverCrest
SilverCrest has
covenanted in the Arrangement Agreement to: (i) use commercially reasonable efforts to cause the SilverCrest Shares to be delisted from
the TSX following the Effective Time; (ii) use commercially reasonable efforts to obtain resignations of all directors of SilverCrest
and its Subsidiaries and separation agreements of each member of senior management who will be terminated, as requested by Coeur; and
(iii) effect certain reorganizations of SilverCrest’s or its Subsidiaries’ business, operations and assets or such other
transactions, as requested by Coeur subject to the conditions in the Arrangement Agreement.
Covenants
Specific to Coeur
Coeur has undertaken
covenants in the Arrangement Agreement to: (i) use commercially reasonable efforts to ensure that the Consideration Shares and the Replacement
Options will be, at the Effective Time, registered or qualified under applicable U.S. state securities laws, or exempt from such registration
and qualification requirements; (ii) file the Coeur Charter Amendment with the Secretary of the State of Delaware prior to the Effective
Time; and (iii) provide compensation and benefits to certain SilverCrest employees (as described further below under “Certain
Employee Matters”).
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Other
Covenants and Agreements
The Arrangement
Agreement contains certain other covenants and agreements by both Coeur and SilverCrest, including covenants relating to:
| (a) | efforts
to obtain applicable regulatory approvals related to the Arrangement; |
| (b) | efforts
to mutually determine and implement any necessary, appropriate or desirable arrangements
in respect of Coeur’s and SilverCrest’s and their respective Subsidiaries’
credit agreements, indentures or other documents governing or relating to indebtedness; |
| (c) | cooperation
between Coeur and SilverCrest in connection with public announcements and communications; |
| (d) | cooperation
between Coeur and SilverCrest in the preparation and filing of this Circular and the Coeur
Proxy Statement; |
| (e) | cooperation
between Coeur and SilverCrest in connection with Coeur’s application for the listing
of the Consideration Shares on the NYSE prior to the Effective Time; |
| (f) | access
by each Party to certain information about the other Party during the period prior to the
Effective Time and the Parties’ agreement to keep information exchanged confidential;
|
| (g) | cooperation
between Coeur and SilverCrest in respect of applicable tax filings related to the Arrangement;
and |
| (h) | indemnification
of directors and officers of SilverCrest and its Subsidiaries in respect of claims arising
from facts or events which occurred on or prior to the Effective Time (as described further
below under “Insurance Matters”). |
Covenants Regarding
Non-Solicitation and Acquisition Proposals
Non-Solicitation
Except as expressly
provided in the Arrangement Agreement, each of Coeur and SilverCrest has agreed to not, and to cause each of its Subsidiaries to not,
and shall not authorize any of their respective Representatives (including directors, officers, employees, advisors, agents, or other
authorized Representatives) to:
| (a) | solicit,
initiate, knowingly encourage or otherwise knowingly facilitate (including by way of furnishing
or providing copies of, access to, or disclosure of, any confidential information, properties,
facilities, books or records of a Party or
any of its Subsidiaries) any inquiry, proposal, or offer that constitutes or may reasonably be expected to constitute or lead to an Acquisition
Proposal in respect of such Party; |
| (b) | engage
or participate in any discussions or negotiations with any person (other than the other Party
or its affiliates) in respect of any inquiry, proposal or offer that constitutes or may reasonably
be expected to constitute or lead to an Acquisition Proposal, provided that either Party
may (a) advise any person of the restrictions of the Arrangement Agreement, (b) clarify the
terms of any proposal in order to determine if it may reasonably be expected to result in
a Superior Proposal, and (c) advise any person making an Acquisition Proposal that the board
of directors of such Party has determined that such Acquisition Proposal does not constitute,
or is not reasonably expected to result in, a Superior Proposal; or |
| (c) | make
a Change in Recommendation. |
Each of Coeur
and SilverCrest has agreed to, and to cause its Subsidiaries and its Representatives to, immediately cease and cause to be terminated,
any existing solicitation, encouragement, discussion or negotiation with any person (other than the other Party or its affiliates) with
respect to any inquiry, proposal or offer that constitutes or may reasonably be expected to constitute or lead to an Acquisition Proposal
and, in respect of such Party, and, in connection therewith, such Party has agreed to discontinue access to any of its and its Subsidiaries’
confidential information (and not establish or allow access to any of its confidential information, or any data room, virtual or otherwise,
in each case, except as permitted by the Arrangement Agreement) and shall as promptly as reasonably
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practicable request, and use commercially
reasonable efforts to exercise all rights it has (or cause its Subsidiaries to exercise rights that they have) to require the return
or destruction of all confidential information regarding the other Party and its Subsidiaries provided in the preceding 12-month period
in connection therewith (to the extent such information has not already been returned or destroyed and shall use its commercially reasonable
efforts to confirm that such requests are complied with in accordance with the terms of such rights). Each of Coeur and SilverCrest has
agreed to not authorize or permit any of its Subsidiaries to, directly or indirectly, amend, modify or release any third party from any
confidentiality, non-solicitation or standstill agreement (or standstill provisions contained in any such agreement) to which such third
party is a party (it being understood that the automatic termination or release of any standstill provisions contained in any such agreements
as a result of the entering into or announcement of the Arrangement Agreement shall not be a violation of the Arrangement Agreement,
or terminate, modify, amend or waive the terms thereof).
Notification
of Acquisition Proposals
Each of Coeur
and SilverCrest has agreed that if it or any of its Subsidiaries or Representatives, receives (a) any inquiry, proposal or offer that
constitutes or could reasonably be expected to constitute or lead to an Acquisition Proposal, or (b) any request for non-public information
relating to the Party or any of its Subsidiaries or access to the properties, books or records of the Party or any Subsidiary in connection
with any inquiry, proposal or offer that constitutes or could reasonably be expected to constitute or lead to an Acquisition Proposal,
then such Party shall:
| (a) | promptly
notify the other Party orally and then as soon as reasonably practicable thereafter (and,
in any event, within 24 hours) in writing of such Acquisition Proposal, inquiry, proposal,
offer or request; and |
| (b) | indicate
the identity of the person or group of persons making such proposal, inquiry or contact and
all material terms and conditions thereof; and |
| (c) | provide
a copy of any such Acquisition Proposal, inquiry, proposal, offer or request and unredacted
copies of all material written communications (and a summary of all substantive discussions)
related thereto; and |
| (d) | keep
the other Party promptly (and, in any event, within 24 hours) informed of the status, including
any change to the material terms, of any such Acquisition Proposal, inquiry, proposal, offer
or request. |
Responding
to an Acquisition Proposal
Notwithstanding
the covenants described under “Non-Solicitation” above, if prior to obtaining, in the case of Coeur, the requisite
Coeur Stockholder Approvals, or in the case of SilverCrest, the requisite SilverCrest Securityholder Approval, either
Coeur
or SilverCrest receives a bona fide written Acquisition Proposal, such Party may (x) engage in or participate in discussions
or negotiations with the person or group of persons making such Acquisition Proposal, and (y) provide such person or group of persons
non-public information relating to such Party or any of its Subsidiaries or access to the properties, books or records of such Party
or any Subsidiary, if and only if:
| (a) | the
board of directors of such Party determines, in good faith after consultation with its legal
and financial advisors, that such Acquisition Proposal constitutes or would reasonably be
expected to constitute or lead to a Superior Proposal, and has provided the other Party with
written notice of such determination; |
| (b) | the
board of directors of such Party determines, in good faith after consultation with its legal
and financial advisors, that the failure to participate in such discussions or negotiations
or to disclose such non-public information to such third party would be inconsistent with
its fiduciary duties under applicable Law; |
| (c) | such
Acquisition Proposal did not result from a breach of its non-solicitation covenants described
above under “Non-Solicitation” in any material respect; and |
| (d) | prior
to providing any such copies, access or disclosures, (i) such Party enters into a confidentiality
agreement with such person, or confirms it has previously entered into such an agreement
which remains in effect, in either case on terms not materially less stringent than the Confidentiality
Agreement, (ii) such Party provides the other Party with a true, complete |
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| | | and
final executed copy of such confidentiality agreement, and (iii) any such copies, access
or disclosure provided to such person shall have already been or shall concurrently be provided
to the other Party. |
Superior
Proposals and Right to Match
Coeur and SilverCrest
have agreed that if, prior, in the case of Coeur being the receiving party, prior to obtaining the Coeur Stockholder Approvals, or in
the case of SilverCrest being the receiving party, prior to obtaining the SilverCrest Securityholder Approval, a Party receives a written
Acquisition Proposal that its board of directors (after consultation with its legal and financial advisors) determines in good faith
constitutes a Superior Proposal, such receiving party may make a Change in Recommendation, in respect of the Arrangement and/or enter
into a definitive agreement with respect to such Superior Proposal, if and only if:
| (a) | such
Acquisition Proposal did not result from a breach of its non-solicitation covenants described
above under “Non-Solicitation” in any material respect; |
| (b) | prior
to such receiving party making a Company Change in Recommendation or a Coeur Change in Recommendation,
as applicable, and/or such receiving party entering into a definitive agreement with respect
to such Superior Proposal, such receiving party has provided the other Party with notice
in writing, which notice shall contain (a) a statement as to the intention of the board of
directors of the receiving party to determine such Acquisition Proposal constitutes a Superior
Proposal, (b) the value in financial terms that the board of directors of the receiving party
has determined should be ascribed to any non-cash consideration offered under such Superior
Proposal, (c) a copy of any definitive agreement relating to such Superior Proposal, as applicable,
and (d) copies of any material financing documents provided to the receiving party in connection
therewith (with customary redactions); |
| (c) | at
least five business days (the “Matching Period”) have elapsed from the
date that the other Party received the notice from the receiving party in respect of the
Superior Proposal; |
| (d) | during
the Matching Period, the other Party shall have had the opportunity (but not the obligation)
to amend the terms of the Arrangement in accordance with the terms as described below; |
| (e) | after
the Matching Period, the board of directors of the receiving party (after consultation with
its legal and financial advisors) has determined in good faith that such Acquisition Proposal
continues to constitute a Superior Proposal, compared to any proposed amendments to the terms
of the Arrangement by the other Party; and |
| (f) | prior
to or concurrently with entering into such definitive agreement in respect of the Superior
Proposal, the receiving party shall have terminated the Arrangement Agreement and shall have
paid to the other Party the applicable termination payment as described below. |
Coeur and SilverCrest
acknowledge and agree that, during the Matching Period, (i) the other Party shall have the opportunity, but not the obligation, to propose
to amend the terms of the Arrangement, (ii) the receiving party shall negotiate in good faith with the other Party to enable the other
Party to make such amendments to the terms of the Arrangement as would enable the receiving party to proceed with the Arrangement and
any related transactions on such amended terms, and (iii) the board of directors of the receiving party shall review any proposal by
the other Party to amend the terms of the Arrangement in order to determine in good faith whether such proposal would result in the Acquisition
Proposal previously constituting a Superior Proposal, ceasing to constitute a Superior Proposal, compared to the proposed amendments
to the terms of the Arrangement. If the board of directors of the receiving party determines that such Acquisition Proposal would cease
to constitute a Superior Proposal, as compared to the proposed amendments to the terms of the Arrangement, Coeur and SilverCrest will
promptly amend the Arrangement Agreement and the Plan of Arrangement to reflect such proposed amendments.
The board of
directors of the receiving party shall promptly reaffirm its recommendation in respect of the Arrangement by press release after: (i)
any Acquisition Proposal which the board of directors of the receiving party determines not to constitute a Superior Proposal is publicly
announced; or (ii) the board of directors of the receiving party determines that a proposed amendment to the terms of the Arrangement
as described in the foregoing paragraph would result in any Acquisition Proposal which has been publicly announced no longer constituting
a Superior Proposal. The other Party and its counsel shall be given a reasonable opportunity to
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review and comment on the form and content
of any such press release, recognizing that whether or not such comments are appropriate will be determined by the receiving party, acting
reasonably.
Nothing in the
Arrangement Agreement shall prevent the board of directors of the receiving party from: (a) calling and holding a meeting of SilverCrest
Shareholders requisitioned by the SilverCrest Shareholders in accordance with the BCBCA, or calling and holding a meeting of Coeur Stockholders
requisitioned by the Coeur Stockholders in accordance with Coeur’s constating documents, as applicable; (b) calling and holding
a meeting of Coeur Stockholders or Shareholders, as applicable, ordered to be held by a court in accordance with law; (c) in the case
of SilverCrest, responding through a directors’ circular or otherwise, as required by applicable securities laws, to an Acquisition
Proposal that it determines is not a Superior Proposal; or (d) in the case of Coeur, (i) disclosing to the Coeur Stockholders a position
contemplated by Rules 14d-9 and 14e-2(a) promulgated under the U.S. Exchange Act or other disclosure required to be made in a proxy statement
by applicable Laws, and (ii) making any “stop, look and listen” communication to the Coeur Stockholders pursuant to Rule
14d-9(f) promulgated under the U.S. Exchange Act, or any similar statement in response to any publicly disclosed Acquisition Proposal;
provided that any “stop, look and listen” statement, or any such similar statement also includes an express reaffirmation
of the Coeur Board Recommendation in respect of the Arrangement.
Each successive
amendment or modification of any Acquisition Proposal that results in an increase in, or modification of, the consideration (or value
of such consideration) to be received by the Coeur Stockholders or SilverCrest Securityholders, as applicable, or other material terms
or conditions thereof, shall constitute a new Acquisition Proposal for the purposes of Coeur’s and SilverCrest’s obligations
described under this section (except that the Matching Period in respect of any successive amendment or modification shall be two business
days).
Certain Employee
Matters
The Arrangement
Agreement sets forth certain provisions relating to compensation and benefits of SilverCrest employees that generally apply following
the Effective Time. From and after the Effective Time, Coeur shall cause SilverCrest and any successor to SilverCrest, to honour and
fully comply in all material respects with the terms of all existing employment, consulting, indemnification, change in control, severance,
termination or other compensation arrangements and employment and severance obligations of SilverCrest and any of its Subsidiaries that
were entered into prior to the date of the Arrangement Agreement in the ordinary course or otherwise disclosed to Coeur. During the first
12 months following the Effective Time, Coeur will provide each SilverCrest employee who remains employed following the Effective Time
(the “Continuing Employees”) with base salary or wages, target annual cash-based incentive opportunities, retirement
and welfare benefits and severance benefits (excluding retention, change of control or transaction compensation and long-term,
equity or equity-based incentive opportunities (the “Excluded Benefits”)), in each case, that are, in the aggregate,
no less favourable than the practices, plans or policies in effect and provided to such employees immediately prior to the Effective
Time.
Coeur shall use
commercially reasonable efforts to cause the Coeur benefit plans to be available to Continuing Employees, to take into account each Continuing
Employee’s service with SilverCrest or any of its Subsidiaries, as applicable, (but not for purposes of any Excluded Benefits)
to the same extent recognized by comparable plans of SilverCrest and its Subsidiaries prior to the Effective Time; provided, however,
that such crediting of service shall not operate to duplicate any benefit or the funding of any such benefit
Coeur shall use
commercially reasonable efforts to: (i) cause insurance carriers to waive all limitations as to pre-existing conditions, exclusions
and waiting periods under applicable Coeur benefit plans for each Continuing Employee to the same extent waived under the comparable
SilverCrest benefit plan prior to the Effective Time; and (ii) cause insurance carriers to honour under the applicable Coeur benefit
plan, in determining any deductible and maximum out-of-pocket limitations, amounts paid by such Continuing Employees (and their covered
dependents) with respect to similar plans maintained by SilverCrest or its Subsidiaries, only to the same extent recognized by SilverCrest
or its Subsidiaries under the comparable SilverCrest benefit plan prior to the Effective Time. Credited expenses shall also count toward
any annual or lifetime limits, treatment or visit limits or similar limitations that apply under the terms of the applicable plan.
The Arrangement
Agreement does not: (i) guarantee employment or service of any person, or continued receipt of any specific employee benefit, or
preclude the ability of Coeur, SilverCrest or any of their respective Subsidiaries, to terminate any Continuing Employee or the employment
or service of any person; (ii) amend or terminate any SilverCrest benefit plan or other employee benefit plan, program, agreement or
arrangement; or (iii) create any third party beneficiary rights in any individual or person.
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Insurance Matters
Pursuant to the
Arrangement Agreement, SilverCrest will purchase customary “tail” policies of directors’ and officers’ liability
insurance providing protection no less favourable in the aggregate to the protection provided by the policies maintained by SilverCrest
and its Subsidiaries which are in effect immediately prior to the Effective Date and providing protection in respect of claims arising
from facts or events which occurred on or prior to the Effective Date and Coeur will, or will cause SilverCrest and its Subsidiaries
to, maintain such tail policies in effect without any reduction in scope or coverage for six years from the Effective Date; provided
that (i) Coeur will not be required to pay any amounts in respect of such coverage prior to the Effective Time, and (ii) the cost of
such policy shall not exceed 400% of SilverCrest’s current annual aggregate premium for policies currently maintained by SilverCrest
or its Subsidiaries. Coeur has also agreed to honour all rights to indemnification or exculpation existing in favour of present and former
officers and directors of SilverCrest and its Subsidiaries, which will survive the completion of the Arrangement and will continue in
full force and effect for a period of not less than six years from the Effective Date.
Termination of
the Arrangement Agreement
Termination
by Either Party
The Arrangement
Agreement may be terminated prior to the Effective Time by the mutual written agreement of Coeur and SilverCrest, or by either SilverCrest
or Coeur if:
| (a) | Occurrence
of Outside Date. The Effective Time shall not have occurred on or before May 19, 2025,
provided, however, that if the Effective Time has not occurred by such date by reason of
the COFECE Approval not having been obtained and all other conditions have theretofore been
satisfied (other than those conditions that by their terms are to be satisfied at the Effective
Time, each of which is capable of being satisfied at the Effective Time) or (to the extent
permitted by Law) waived, the Initial Outside Date will be extended to August 19, 2025; except
that the right to terminate the Arrangement Agreement will not be available to any Party
whose failure to perform any of its covenants or agreements or breach of any of its representations
and warranties under the Arrangement Agreement has been the cause of, or resulted in, the
failure of the Effective Time to occur by the Outside Date. |
| (b) | Illegality.
After the date of the Arrangement Agreement, there shall have been enacted, made or enforced
any applicable Law (or any applicable Law shall have been amended) that makes consummation
of the Arrangement illegal or otherwise prohibited or enjoins SilverCrest or Coeur from consummating
the Arrangement and such applicable Law, prohibition or enjoinment shall have become final
and non-appealable. |
| (c) | Failure
to Obtain SilverCrest Securityholder Approval. The SilverCrest Securityholder Approval
has not been obtained at the Meeting (or any adjournment(s) or postponement(s) thereof) in
accordance with the Interim Order, except that the right to terminate the Arrangement Agreement
will not be available to any Party whose failure to perform any of its covenants or agreements
or breach of any of its representations and warranties in any material respect under the
Arrangement Agreement has been the cause of, or resulted in, the failure to receive the SilverCrest
Securityholder Approval. |
| (d) | Failure
to Obtain Coeur Stockholder Approvals. The Coeur Stockholder Approvals have not been
obtained at the Coeur Meeting (or any adjournment(s) or postponement(s) thereof) in accordance
with applicable Law, except that the right to terminate the Arrangement Agreement will not
be available to any Party whose failure to perform any of its covenants or agreements or
breach of any of its representations and warranties in any material respect under the Arrangement
Agreement has been the cause of, or resulted in, the failure to receive the Coeur Stockholder
Approvals. |
Termination
by Coeur
The Arrangement
Agreement may be terminated prior to the Effective Time by Coeur if:
| (a) | Company
Change in Recommendation. The Board makes a Company Change in Recommendation described
under “Non-Solicitation” above; |
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| (b) | SilverCrest
Material Breach of Non-Solicit. SilverCrest breaches its non-solicitation covenants described
under “Non-Solicitation” above in any material respect; |
| (c) | Breach
of Representation or Warranty or Failure to Perform Covenants by SilverCrest. Subject
to compliance with the notice and cure provisions of the Arrangement Agreement, (i) a breach
of any representation or warranty, or (ii) failure to perform any covenant or agreement on
the part of SilverCrest set forth in the Arrangement Agreement (other than the non-solicitation
covenants described under “Non-Solicitation” above), in each case,
shall have occurred that would cause the mutual conditions precedent or additional conditions
precedent to Coeur’s obligations not to be satisfied, and such breach or failure is
incapable of being cured prior to the Outside Date; provided that Coeur is not then in breach
of the Arrangement Agreement so as to cause any mutual condition precedent or additional
conditions precedent to SilverCrest’s obligations not to be satisfied; or |
| (d) | Coeur
Superior Proposal. Prior to the receipt of the Coeur Stockholder Approvals, Coeur wishes
to enter into a definitive agreement with respect to a Coeur Superior Proposal (other than
a confidentiality agreement permitted by the Arrangement Agreement); provided that Coeur
is then in compliance with its covenants relating to non-solicitation and Acquisition Proposals
under the Arrangement Agreement in all material respects and that, prior to or concurrently
with such termination, Coeur pays the Coeur Termination Payment described below. |
Termination
by SilverCrest
The Arrangement
Agreement may be terminated prior to the Effective Time by SilverCrest if:
| (a) | Coeur
Change in Recommendation. The Coeur Board makes a Coeur Change in Recommendation described
under “Non-Solicitation” above; |
| (b) | Coeur
Material Breach of Non-Solicit. Coeur breaches its non-solicitation covenants described
under “Non-Solicitation” above in any material respect; |
| (c) | Breach
of Representation or Warranty or Failure to Perform Covenants by Coeur. Subject to compliance
with the notice and cure provisions of the Arrangement Agreement, (i) a breach of any representation
or warranty, or (ii) failure to perform any covenant or agreement on the part of Coeur set
forth in the Arrangement Agreement (other than the non-solicitation covenants described under
“Non-Solicitation” above), in each case, shall have occurred that
would cause the mutual conditions precedent or additional conditions precedent to SilverCrest’s
obligations not to be satisfied, and such breach or failure is incapable of being cured prior
to the Outside Date; provided that SilverCrest is not then in breach of the Arrangement Agreement
so as to cause any mutual condition precedent or additional conditions precedent to Coeur’s
obligations not to be satisfied; or |
| (d) | Company
Superior Proposal. Prior to the receipt of the SilverCrest Securityholder Approval, SilverCrest
wishes to enter into a definitive agreement with respect to a Company Superior Proposal (other
than a confidentiality agreement permitted by the Arrangement Agreement); provided that SilverCrest
is then in compliance with the covenants relating to non-solicitation and Acquisition Proposals
described above in all material respects and that, prior to or concurrently with such termination,
SilverCrest pays the Company Termination Payment described below. |
Termination
Payments
The Arrangement
Agreement provides that (a) if a Coeur Termination Payment Event (as defined below) occurs, Coeur shall pay, as liquidated damages in
consideration for the loss of SilverCrest’s rights under the Arrangement Agreement, by wire transfer of immediately available funds
the Coeur Termination Payment of $100,000,000; and (b) if a Company Termination Payment Event (as defined below) occurs, SilverCrest
shall pay, as liquidated damages in consideration for the loss of Coeur’s rights under the Arrangement Agreement, by wire transfer
of immediately available funds the Company Termination Payment of $60,000,000.
A “Company
Termination Payment Event” means the termination of the Arrangement Agreement:
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| (a) | by
Coeur upon the circumstances described in the paragraph “Company Change in Recommendation”
or “SilverCrest Material Breach of Non-Solicit” under the heading
“Termination of the Arrangement Agreement – Termination by Coeur”
above; |
| (b) | by
SilverCrest upon circumstances described in the paragraph “Company Superior Proposal”
under the heading “Termination of the Arrangement Agreement – Termination
by SilverCrest” above; or |
| (c) | by
either Party upon circumstances described in the paragraphs “Occurrence of Outside
Date” or “Failure to Obtain SilverCrest Securityholder Approval”
under the heading “Termination of the Arrangement Agreement – Termination
by Either Party” above, or by Coeur upon circumstances described in the paragraph
“Breach of Representation or Warranty or Failure to Perform Covenants by SilverCrest”
under the heading “Termination of the Arrangement Agreement – Termination
by Coeur” above, but, in each case, only if: |
| (i) | prior
to such termination, a bona fide Acquisition Proposal in respect of SilverCrest shall
have been made to SilverCrest and publicly announced by any person making the Acquisition
Proposal (other than Coeur or its affiliates), |
| (ii) | such
Acquisition Proposal has not expired or been withdrawn at least five business days prior
to the Meeting, and |
| (iii) | within
12 months following the date of such termination, either (1) SilverCrest or one or more of
its Subsidiaries enters into a definitive agreement in respect of an Acquisition Proposal
other than a confidentiality agreement permitted by the Arrangement Agreement (whether or
not such Acquisition Proposal is the same Acquisition Proposal referred to in (i) and (ii)
above) and such Acquisition Proposal is subsequently consummated (whether or not within such
12-month period), or (2) an Acquisition Proposal (whether or not such Acquisition Proposal
is the same Acquisition Proposal referred to in (i) and (ii) above) is consummated. |
A “Coeur
Termination Payment Event” means the termination of the Arrangement Agreement:
| (a) | by
SilverCrest upon the circumstances described in the paragraph “Coeur Change in Recommendation”
or “Coeur Material Breach of Non-Solicit” under the heading “Termination
of the Arrangement Agreement – Termination by SilverCrest” above; |
| (b) | by
Coeur upon circumstances described in the paragraph “Coeur Superior Proposal”
under the heading “Termination of the Arrangement Agreement – Termination
by Coeur” above; or |
| (c) | by
either Party upon circumstances described in the paragraphs “Occurrence of Outside
Date” or “Failure to Obtain Coeur Stockholder Approvals” under
the heading “Termination of the Arrangement Agreement – Termination by Either
Party” above, or by SilverCrest upon circumstances described in the paragraph “Breach
of Representation or Warranty or Failure to Perform Covenants by Coeur” under the
heading “Termination of the Arrangement Agreement – Termination by SilverCrest”
above, but, in each case, only if: |
| (i) | prior
to such termination, a bona fide Acquisition Proposal in respect of Coeur shall have
been made to Coeur and publicly announced by any person making the Acquisition Proposal (other
than SilverCrest or its affiliates), |
| (ii) | such
Acquisition Proposal has not expired or been withdrawn at least five business days prior
to the Coeur Meeting, and |
| (iii) | within
12 months following the date of such termination, either (1) Coeur or one or more of its
Subsidiaries enters into a definitive agreement in respect of an Acquisition Proposal other
than a confidentiality agreement permitted by the Arrangement Agreement (whether or not such
Acquisition Proposal is the same Acquisition Proposal referred to in (i) and (ii) above)
and such Acquisition Proposal is subsequently consummated (whether or not within such 12-month
period), or (2) an Acquisition Proposal (whether or not such Acquisition Proposal is the
same Acquisition Proposal referred to in (i) and (ii) above) is consummated. |
For purposes
of the Company Termination Payment Event and the Coeur Termination Payment Event referred to above, the term “Acquisition Proposal”
has the meaning assigned thereto under “Glossary of Terms”, except that references to “20% or more” are
deemed to be references to “50% or more”.
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Expense
Reimbursement Payable by SilverCrest
In the event
that the Arrangement Agreement is terminated by either Coeur or SilverCrest upon circumstances described in the paragraphs “Failure
to Obtain SilverCrest Securityholder Approval” under the heading “Termination of the Arrangement Agreement –
Termination by Either Party” above, and the Board has not made a Company Change in Recommendation, SilverCrest will reimburse
Coeur for all reasonable and documented expenses incurred by Coeur’s third-party Representatives in respect of the Arrangement
and the Arrangement Agreement, up to a maximum of $17,000,000. However, if SilverCrest is required to pay the Company Termination Payment
to Coeur due to a Company Termination Payment Event occurring, SilverCrest will not be required to pay the Expense Reimbursement to Coeur.
Expense
Reimbursement Payable by Coeur
In the event
that the Arrangement Agreement is terminated by either Coeur or SilverCrest upon circumstances described in the paragraphs “Failure
to Obtain Coeur Stockholder Approvals” under the heading “Termination of the Arrangement Agreement – Termination
by Either Party” above, and the Coeur Board has not made a Coeur Change in Recommendation, Coeur will reimburse SilverCrest
for all reasonable and documented expenses incurred by SilverCrest’s third-party Representatives in respect of the Arrangement
and the Arrangement Agreement, up to a maximum of $17,000,000. However, if Coeur is required to pay the Coeur Termination Payment due
to a Coeur Termination Payment Event occurring, Coeur will not be required to pay the Expense Reimbursement to SilverCrest.
Amendments
Subject to
the provisions of the Interim Order, Final Order, the Plan of Arrangement and applicable Laws, the Arrangement Agreement and the
Plan of Arrangement may, at any time and from time to time before or after the holding of the Meeting but not later than the
Effective Time, be amended by mutual written agreement of the Parties, without further notice to or authorization on the part of the
Securityholders, and any such amendment may, without limitation:
| (a) | | change
the time for performance of any of the obligations or acts of the Parties; |
| (b) | | waive
any inaccuracies or modify any representation or warranty contained therein or in any document
delivered pursuant thereto; |
| (c) | | waive
compliance with or modify any of the covenants therein contained and waive or modify performance
of any of the obligations of the Parties; and |
| (d) | | waive
compliance with or modify any mutual conditions precedent therein contained. |
In addition,
pursuant to the Plan of Arrangement:
| (a) | | Coeur
and SilverCrest reserve the right to amend, modify or supplement the Plan of Arrangement
at any time and from time to time, provided that each such amendment, modification or supplement
must be (i) agreed to in writing by SilverCrest and Coeur, (ii) filed with the Court and,
if made following the Meeting, approved by the Court, and (iii) communicated to Securityholders
if and as required by the Court. |
| (b) | | Subject
to the provisions of the Interim Order, any amendment, modification or supplement to the
Plan of Arrangement may be proposed by Coeur and SilverCrest at any time prior to the Meeting
(provided, however, that Coeur and SilverCrest shall have consented thereto in writing),
with or without any other prior notice or communication, and, if so proposed and accepted
by the persons voting at the Meeting (other than as may be required under the Interim Order),
shall become part of the Plan of Arrangement for all purposes. |
| (c) | | Any
amendment, modification or supplement to the Plan of Arrangement that is approved or directed
by the Court following the Meeting shall be effective only if: (i) it is consented to in
writing by each of Coeur and SilverCrest (each acting reasonably); and (ii) if required by
the Court, it is consented to by the Shareholders voting in the manner directed by the Court. |
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| (d) | | Any
amendment, modification or supplement to the Plan of Arrangement may be made by SilverCrest
and Coeur without the approval of or communication to the Court or the Securityholders, provided
that it concerns a matter which, in the reasonable opinion of SilverCrest and Coeur, is of
an administrative or ministerial nature required to better give effect to the implementation
of the Plan of Arrangement and is not adverse to the financial or economic interests of any
of the Securityholders. |
| (e) | | The
Plan of Arrangement may be withdrawn prior to the Effective Time in accordance with the terms
of the Arrangement Agreement. |
Governing Law
The Arrangement
Agreement is governed, including as to validity, interpretation and effect, by the laws of the Province of British Columbia and the federal
laws of Canada applicable therein.
Specific Performance
In addition to
any other remedy that may be available to each Party under the terms of the Arrangement Agreement, a non-breaching Party will be entitled,
without the requirement of posting a bond or other security, to equitable relief, including injunctive relief or specific performance,
and the Parties shall not object to the granting of injunctive or other equitable relief on the basis that there exists an adequate remedy
at law.
RISK
FACTORS
In evaluating
the Arrangement, Securityholders should carefully consider the following risk factors relating to the Arrangement. The following risk
factors are not a definitive list of all risk factors associated with the Arrangement. Additional risks and uncertainties, including
those currently unknown or considered immaterial by SilverCrest, may also adversely affect the trading price of the SilverCrest Shares,
the Coeur Shares and/or the business of the Combined Company following the Arrangement. In addition to the risk factors relating to the
Arrangement set out below, Securityholders should also carefully consider the risk factors associated with the businesses of SilverCrest
and Coeur under “Information Concerning SilverCrest”, Appendix H “Information Concerning Coeur”
and Appendix I “Information Concerning the Combined Company” in this Circular and in the documents incorporated by
reference herein. If any of the risk factors materialize, the expectations, and the predictions based on them, may need to be re-evaluated.
Risk Relating to
the Arrangement
The Coeur
Shares issued in connection with the Arrangement may have a market value different than expected
Each Shareholder
will receive Coeur Shares as the Consideration based on the Exchange Ratio. Because the Exchange Ratio and therefore the number of Coeur
Shares received as part of Consideration will not be adjusted to reflect any changes in the market value of Coeur Shares or SilverCrest
Shares, the market values of the Coeur Shares and the SilverCrest Shares at the Effective Time may vary significantly from the values
at the date of this Circular. If the market price of Coeur Shares declines, the value of the Consideration received by Shareholders will
decline as well. Variations may occur as a result of changes in, or market perceptions of changes in, the business, operations or prospects
of Coeur, market assessments of the likelihood that the Arrangement will be consummated, regulatory considerations, general market and
economic conditions, changes in the prices of metals and other factors, including those factors over which neither SilverCrest nor Coeur
has control. As a result of such variations, historical market prices are not indicative of future market prices or the market value
of the Coeur Shares that Shareholders may receive on the Effective Date. There can be no assurance that the market value of the Consideration
that Shareholders receive on the Effective Date will equal or exceed the market value of the SilverCrest Shares held by such Shareholders
after the date hereof and prior to the Effective Date. There can also be no assurance that the trading price of the Coeur Shares will
not decline following the completion of the Arrangement.
The market
price of the SilverCrest Shares and Coeur Shares may be materially adversely affected in certain circumstances
If, for any reason,
the Arrangement is not completed or its completion is materially delayed and/or the Arrangement Agreement is terminated, the market price
of SilverCrest Shares may be materially adversely affected and decline to the extent that the current market price of the SilverCrest
Shares reflects a market assumption that the Arrangement will be completed. Depending on the reasons
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for terminating the Arrangement
Agreement, SilverCrest’s business, financial condition or results of operations could also be subject to various material adverse
consequences, including as a result of paying the Company Termination Payment or the Expense Reimbursement, as applicable in connection
to the Arrangement.
The completion
of the Arrangement is subject to conditions precedent
The completion
of the Arrangement is subject to a number of conditions precedent, some of which are outside of SilverCrest’s or Coeur’s
control, including receipt of the Final Order, SilverCrest Securityholder Approval, Coeur Stockholder Approvals, COFECE Approval and
certain regulatory and securities exchange approvals. The regulatory approval process may take a lengthy period to complete which could
delay completion of the Arrangement.
In addition,
the completion of the Arrangement is conditional on, among other things, no Company Material Adverse Effect or Coeur Material Adverse
Effect having occurred and is continuing as of the Effective Time.
There can be
no certainty, nor can SilverCrest or Coeur provide any assurance, that all conditions precedent to the Arrangement will be satisfied
or waived, or as to the timing of the satisfaction and waiver of such conditions precedent and, accordingly, the Arrangement may not
be completed. If the Arrangement is not completed or its completion is materially delayed, and/or the Arrangement Agreement is
terminated, the market price of SilverCrest Shares may be adversely affected. In such events, SilverCrest’s business,
financial condition or results of operations could also be subject to various material adverse consequences, including that
SilverCrest would remain liable for costs relating to the Arrangement.
The completion
of the Arrangement is uncertain and SilverCrest will incur costs and may have to pay the Company Termination Payment or the Expense Reimbursement
under certain circumstances
If the Arrangement
is not completed for any reason, there are risks that the announcement of the Arrangement and the dedication of SilverCrest’s resources
to the completion thereof could have a negative impact on SilverCrest’s relationships with its stakeholders and could have a material
adverse effect on the current and future operations, financial condition and prospects of SilverCrest.
In addition,
certain costs related to the Arrangement, such as legal, accounting and certain financial advisor fees, must be paid by SilverCrest and
Coeur even if the Arrangement is not completed. SilverCrest and Coeur are each liable for their own costs incurred in connection with
the Arrangement, subject to the Expense Reimbursement payable by the other Party in certain circumstances. If the Arrangement is not
completed, SilverCrest may be required to pay Coeur the Company Termination Payment or the Expense Reimbursement in certain circumstances.
The payment of such fee may have an adverse effect on SilverCrest’s financial position. See “The Arrangement Agreement
– Termination of Arrangement Agreement” in this Circular.
SilverCrest
is restricted from taking certain actions while the Arrangement is pending
SilverCrest is
also subject to customary non-solicitation provisions under the Arrangement Agreement, pursuant to which, SilverCrest is restricted from
soliciting, initiating or knowingly encouraging any Acquisition Proposal, among other things. The Arrangement Agreement also restricts
SilverCrest from taking specified actions without the consent of Coeur until the Arrangement is completed. These restrictions may prevent
SilverCrest from pursuing attractive business opportunities that may arise prior to the completion of the Arrangement. If the Arrangement
is not completed for any reason, the announcement of the Arrangement, the dedication of SilverCrest’s resources to the completion
thereof, and the restrictions that were imposed on SilverCrest, may have an adverse effect on the future operations, financial condition
and prospects of SilverCrest as a standalone entity.
The Company
Termination Payment provided under the Arrangement Agreement may discourage other parties from attempting to acquire SilverCrest
Under the Arrangement
Agreement, SilverCrest would be required to pay a Company Termination Payment of $60,000,000 if the Arrangement Agreement is terminated
in certain circumstances. This Company Termination Payment may discourage other parties from attempting to acquire SilverCrest Shares
or otherwise making an Acquisition Proposal to SilverCrest, even if those parties would otherwise be willing to offer greater value to
Securityholders than that offered by Coeur under the Arrangement. In addition, the payment of such fee may have an adverse effect on
SilverCrest’s financial position.
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The Arrangement
may divert the attention of SilverCrest’s Management
The Arrangement
could cause the attention of SilverCrest’s management to be diverted from the day-to-day operations of SilverCrest. These disruptions
could be exacerbated by a delay in the completion of the Arrangement and could result in lost opportunities or negative impacts on performance,
which could have a material and adverse effect on the business, operating results or prospects of SilverCrest if the Arrangement is not
completed, and on Coeur following the Effective Date.
The Arrangement
Agreement may be terminated in certain circumstances
Each of
Coeur and SilverCrest has the right, in certain circumstances, in addition to termination rights relating to the failure to satisfy
the conditions of closing, to terminate the Arrangement Agreement. Accordingly, there can be no certainty, nor can SilverCrest
provide any assurance, that the Arrangement will not be terminated by Coeur or SilverCrest prior to the completion of the
Arrangement. In addition, if the Arrangement is not completed by the Outside Date, Coeur or SilverCrest may terminate the
Arrangement Agreement. The Arrangement Agreement also contemplates the Company Termination Payment or the Expense Reimbursement
payable by SilverCrest if the Arrangement Agreement is terminated in certain circumstances. Additionally, any termination
will result in the failure to realize the expected benefits of the Arrangement in respect of the operations and business of
SilverCrest.
If the Arrangement
Agreement is terminated, there is no assurance that the Board will be able to find a party willing to pay an equivalent or greater price
than the Consideration to be paid pursuant to the terms of the Arrangement Agreement.
Directors
and officers of SilverCrest have interests in the Arrangement that may be different from those of Securityholders generally
In considering
the recommendation of the Board with respect to the Arrangement, Securityholders should be aware that certain members of SilverCrest’s
senior management and the Board have certain interests in connection with the Arrangement that may present them with actual or potential
conflicts of interest in connection with the Arrangement. See “The Arrangement – Interests of Certain Persons in the Arrangement”
in this Circular.
The foregoing
risks or other risks arising in connection with the failure of the Arrangement, including the diversion of management attention from
conducting the business of SilverCrest, may have a material adverse effect on SilverCrest’s business operations, financial condition,
financial results and share price.
The Board
considered financial projections prepared by SilverCrest management in connection with the Arrangement, and actual performance of Coeur
and SilverCrest may differ materially from these projections
The Board considered,
among other things, certain projections, prepared by SilverCrest management, with respect to each of Coeur (the “Coeur Projections”),
SilverCrest (the “SilverCrest Projections”) and the Combined Company following the completion of the Arrangement (together
with the Coeur Projections and the SilverCrest Projections, the “Projections”). All such Projections are based on
assumptions and information available at the time such Projections were prepared. SilverCrest does not know whether the assumptions made
will be realized. Such information can be adversely affected by known or unknown risks and uncertainties, many of which are beyond SilverCrest’s
and Coeur’s control. Further, financial forecasts of this type are based on estimates and assumptions that are inherently subject
to risks and other factors such as company performance, geological uncertainties, industry performance, general business, economic, regulatory,
market and financial conditions, as well as changes to the business, financial condition or results of operations of SilverCrest and
Coeur, including the factors described in this “Risk Factors” section and under “Forward-Looking Information”,
which factors and changes may impact such forecasts or the underlying assumptions. As a result of these contingencies, there can be no
assurance that the financial and other Projections will be realized or that actual results will not be significantly higher or lower
than projected. In view of these uncertainties, the references to the Projections in this Circular should not be regarded as an indication
that SilverCrest, the Board, or any of its advisors or any other recipient of this information considered, or now considers, it to be
an assurance of the achievement of future results.
The Projections
were prepared by SilverCrest management for internal use and to, among other things, assist SilverCrest in evaluating the Arrangement.
The Projections were not prepared with a view toward public disclosure or toward compliance with IFRS Accounting Standards, published
guidelines of applicable securities regulatory authorities or the guidelines established by the Chartered Professional Accountants for
preparation and presentation of prospective financial information. PricewaterhouseCoopers LLP,
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SilverCrest’s independent registered
public accounting firm, has not examined, compiled or performed any procedures with respect to the Projections.
In addition,
the Projections have not been updated or revised to reflect information or results after the date that such Projections were prepared
by SilverCrest management or as of the date of this Circular. Except as required by applicable Securities Laws, SilverCrest does not
intend to update or otherwise revise its financial and other forecasts to reflect circumstances existing after the date when made or
to reflect the occurrence of future events, even in the event that any or all of the assumptions are shown to be in error.
Coeur and
SilverCrest may be the targets of legal claims, securities class action, derivative lawsuits and other claims
Coeur and
SilverCrest may be the target of securities class action and derivative lawsuits which could result in substantial costs and may
delay or prevent the Arrangement from being completed. Securities class action lawsuits and derivative lawsuits are often brought
against companies that have entered into an agreement to acquire a public company or to be acquired.
Third parties may also attempt to bring claims against Coeur or SilverCrest seeking to restrain the Arrangement or seeking monetary
compensation or other redress. Even if the lawsuits are without merit, defending against these claims can result in substantial
costs and divert management time and resources. Additionally, if a plaintiff is successful in obtaining an injunction prohibiting
consummation of the Arrangement, then that injunction may delay or prevent the Arrangement from being completed.
The Consideration
Shares to be received by Shareholders as a result of the Arrangement will have different rights from the SilverCrest Shares
Coeur is a Delaware
corporation governed under the DGCL. SilverCrest is a company governed by the BCBCA. Upon completion of the Arrangement, Shareholders
will become Coeur Stockholders and their rights as stockholders will be governed by the DGCL and Coeur’s constating documents.
Certain of the rights associated with Coeur Shares under the DGCL and Coeur’s constating documents are different from the rights
associated with SilverCrest Shares under the BCBCA. See Appendix L “Comparison of Rights of SilverCrest Shareholders and Coeur
Stockholders”.
Failure
by Coeur and/or SilverCrest to comply with applicable Laws prior to the Arrangement could subject the Combined Company to penalties and
other adverse consequences following completion of the Arrangement
Coeur is subject
to the provisions of the U.S. Foreign Corrupt Practices Act. SilverCrest is subject to the U.S. Foreign Corrupt Practices Act
and the Corruption of Foreign Public Officials Act (Canada). The foregoing Laws prohibit companies and their intermediaries
from making improper payments to officials for the purpose of obtaining or retaining business. In addition, such Laws require the maintenance
of records relating to transactions and an adequate system of internal controls over accounting. There can be no assurance that either
Party’s internal control policies and procedures, compliance mechanisms or monitoring programs will protect it from recklessness,
fraudulent behaviour, dishonesty or other inappropriate acts or adequately prevent or detect possible violations under applicable anti-bribery
and anti-corruption legislation. A failure by Coeur or SilverCrest to comply with anti-bribery and anti-corruption legislation could
result in severe criminal or civil sanctions, and may subject the Combined Company to other liabilities, including fines, prosecution,
potential debarment from public procurement and reputational damage, all of which could have a material adverse effect on the business,
consolidated results of operations and consolidated financial condition of the Combined Company following completion of the Arrangement.
Investigations by governmental authorities could have a material adverse effect on the business, consolidated results of operations and
consolidated financial condition of the Combined Company following completion of the Arrangement.
Coeur and SilverCrest
are also subject to a wide variety of Laws relating to the environment, health and safety, taxes, employment, labor standards, money
laundering, terrorist financing and other matters in the jurisdictions in which it operates. A failure by either of Coeur or SilverCrest
to comply with any such legislation prior to the Arrangement could result in severe criminal or civil sanctions, and may subject the
Combined Company to other liabilities, including fines, prosecution and reputational damage, all of which could have a material adverse
effect on the business, consolidated results of operations and consolidated financial condition of the Combined Company following completion
of the Arrangement. The compliance mechanisms and monitoring programs adopted and implemented by either of Coeur or SilverCrest prior
to the Arrangement may not adequately prevent or detect possible violations of such applicable Laws. Investigations by governmental authorities
could also have a material adverse effect on the business, consolidated results of operations and consolidated financial condition of
the Combined Company following completion of the Arrangement.
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Risks
Relating to the Combined Company
The Combined
Company may not recognize certain anticipated synergies and other benefits of the Arrangement
SilverCrest and
Coeur are proposing to complete the Arrangement to realize certain benefits and synergies that are expected to result from combining
the business of the Company with Coeur’s, including, among other things, an enhanced market valuation and stronger financial position.
Expected
benefits from the Arrangement are based on estimates of a variety of key factors, including mineral reserves and resources, grade,
recovery rates, the ability of processing infrastructure to meet desired throughput rates, and operating costs, among others.
However, achieving results in line with those estimates is subject to risks and uncertainties such as variability in grade,
recovery rates and cost inputs and any inability of infrastructure to accommodate higher throughput. There can be no certainty that
the Combined Company will be able to successfully expand or extend the lives of existing mining operations, and a completed project
may not yield the anticipated operational or financial benefits, such as expected availability, throughput, metal recovery rates,
concentrate quality, unit costs, operating margin and/or cash flows, any of which may have a material negative impact on returns on
invested capital, operating costs or cash flows.
The mineral reserves
and mineral resource figures presented in public filings are also based on estimates made by technical personnel and are a function of
geological and engineering analyses that require assumptions about production costs, recoveries, and gold, silver, zinc and lead market
prices. Thus, irrespective of well-established controls, the estimation of mineral reserves and mineral resource figures are based on
subjective factors. No assurances can be given that any mineral resource estimate will ultimately be reclassified as proven or probable
mineral reserves or that inferred resources will be upgraded to measured or indicated resources. Any of these adjustments or updates
to mining plans of the Combined Company or new or updated technical or geological information may also impact anticipated metal recovery
rates. Any of these adjustments may adversely affect actual operating performance, production, financial condition, results of operations
and cash flows.
The anticipated
benefits of the Arrangement on the Combined Company will depend in part on whether SilverCrest’s and Coeur’s operations can
be integrated in an efficient and effective manner. Actual operating, technological, strategic and revenue opportunities, if achieved
at all, may be less significant than expected or may take longer to achieve than anticipated. If the Combined Company is not able to
achieve these objectives and realize the anticipated benefits and synergies expected from the Arrangement within the anticipated timing
or at all, the Combined Company’s business, financial condition and operating results may be adversely affected.
There are
risks related to the integration of the Company’s and Coeur’s existing businesses
The ability to
realize the benefits of the Arrangement including, among other things, those set forth in this Circular under “The Arrangement—
Reasons for the Arrangement”, above, will depend, in part, on the Combined Company’s ability to realize the anticipated
growth opportunities and synergies from integrating SilverCrest’s and Coeur’s businesses following completion of the Arrangement
as well as on successfully consolidating functions and integrating operations, procedures and personnel in a timely and efficient manner.
This integration will require the dedication of substantial management effort, time and resources which may divert management’s
focus and resources from other strategic opportunities available to the Combined Company following completion of the Arrangement, and
from operational matters during this process, and the disruption of, or the loss of momentum in, each company’s ongoing businesses
or inconsistencies in standards, controls, procedures and policies. The integration process may result in the loss of key employees and
the disruption of ongoing business and employee relationships that may adversely affect the ability of the Combined Company to achieve
the anticipated benefits of the Arrangement.
In addition,
the integration process could result in disruption of existing relationships with suppliers, employees, customers and other constituencies
of each company. There can be no assurance that management will be able to integrate the operations of each of the businesses successfully
or achieve any of the synergies or other benefits that are anticipated as a result of the Arrangement. Certain operational and staffing
decisions with respect to integration have not yet been made. These decisions and the integration of the two companies will present challenges
to management, including the integration of systems and personnel of the two companies which may be geographically separated, unanticipated
liabilities, and unanticipated costs. It is possible that the integration process could result in the loss of key employees, difficulties
or loss of social license to operate resulting from failure of efforts to establish positive relationships and/or agreements with local
communities or local indigenous peoples, the disruption of the respective ongoing businesses or inconsistencies in standards, controls,
procedures and policies that adversely affect the ability of management to
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maintain relationships with clients, suppliers, employees
or to achieve the anticipated benefits of the Arrangement. The performance of the Combined Company’s operations after completion
of the Arrangement could be adversely affected if the Combined Company cannot retain key employees to assist in the integration and operation
of Coeur and SilverCrest.
The
consummation of the Arrangement may pose special risks, including one-time write-offs, restructuring charges and unanticipated
costs. Although Coeur, SilverCrest and their respective advisors have conducted due diligence on the various operations, there can
be no guarantee that the Combined Company will be aware of any and all liabilities of SilverCrest or the Arrangement. As a result of
these factors, it is possible that certain benefits expected from the combination of Coeur and SilverCrest may not be
realized. Any inability of management to successfully integrate the operations could have a material adverse effect on the business,
financial condition and results of operations of the Combined Company.
Unaudited
pro forma condensed combined financial statements are presented for illustrative purposes only and may not be indicative of the results
of operations or financial condition of the Combined Company
The unaudited
pro forma condensed combined financial statements included in this Circular are presented for illustrative purposes only to show
the effect of the Arrangement, and should not be considered to be an indication of the financial condition or results of operations of
the Combined Company following completion of the Arrangement. For example, the pro forma condensed combined financial statements
have been prepared using the consolidated historical financial statements of SilverCrest and Coeur and do not represent a financial forecast
or projection. In addition, the pro forma condensed combined financial statements included in this Circular is based in part on
certain assumptions regarding the Arrangement. These assumptions may not prove to be accurate, and other factors may affect the Combined
Company’s results of operations or financial condition following completion of the Arrangement. Accordingly, the historical and
pro forma condensed combined financial statements included in this Circular do not necessarily represent Coeur’s results
of operations and financial condition had SilverCrest and Coeur operated as a combined entity during the periods presented, or of the
Combined Company’s results of operations and financial condition following the Arrangement.
In preparing
the pro forma condensed combined financial statements contained in this Circular, Coeur has given effect to, among other items,
the completion of the Arrangement and the issuance of the Consideration Shares. The unaudited pro forma condensed combined financial
statements do not reflect all of the costs that are expected to be incurred by Coeur in connection with the Arrangement. For example,
the impact of any incremental costs incurred in integrating Coeur and SilverCrest is not reflected in the pro forma condensed
combined financial statements. See also the notes to the unaudited pro forma condensed combined financial statements included
in Appendix J “Unaudited Pro Forma Financial Information” attached to this Circular.
Significant
demands will be placed on the Combined Company as a result of the Arrangement
As
a result of the pursuit and completion of the Arrangement, significant demands will be placed on the managerial, operational and financial
personnel and systems of the Combined Company. There can be no assurance that the systems, procedures and controls of the Combined Company
will be adequate to support the expansion of operations and associated increased costs and complexity following and resulting from the
Arrangement. The future operating results of the Combined Company will be affected by the ability of its officers and key employees to
manage changing business conditions, to integrate the acquisition of SilverCrest, to implement a new business strategy and to improve
its operational and financial controls and reporting systems.
The issuance
and future sale of Coeur Shares following completion of the Arrangement may adversely and materially affect holders of common stock of
the Combined Company and the common stock of the Combined Company may be affected by factors different from those that historically have
affected or that are currently affecting the market price of SilverCrest Shares and Coeur Shares
Following the
completion of the Arrangement, the Combined Company may issue equity securities to finance its activities, including in order to finance
acquisitions. If the Combined Company were to issue additional equity securities, the ownership interest of Shareholders may be diluted
and some or all of the Combined Company’s financial measures on a per share basis could be reduced. As the Combined Company’s
intention to issue additional equity securities becomes publicly known, the Combined Company’s share price may be materially adversely
affected.
Further,
former Shareholders may decide not to hold the Coeur Shares that they receive in the Arrangement, and historic Coeur Stockholders
may decide to reduce their investment in the Combined Company as a result of the changes to the Combined Company’s investment
profile as a result of the Arrangement. These sales of the Combined Company’s common stock (or the perception that
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these sales
may occur) could have the effect of depressing the market price of the Combined Company’s common stock. In addition, the
Combined Company’s financial position after completion of the Arrangement may differ from its financial position before the
completion of the Arrangement, and the results of the Combined Company’s operations and cash flows after the completion of the
Arrangement may be affected by factors different from those currently affecting its financial position or results of operations and
cash flows, all of which could adversely affect the market price of the
Combined Company’s common stock. Accordingly, the market price and performance of the Combined Company’s common stock is
likely to be different from the performance of Coeur Shares prior to the Arrangement. Furthermore, the stock market has experienced
significant price and volume fluctuations in recent times which, if they continue to occur, could have a material adverse effect on
the market for, or liquidity of, the Combined Company’s common stock, regardless of the Combined Company’s actual
operating performance.
It may
not be possible for Shareholders to effect service of process within Canada upon the Combined Company
Coeur is incorporated
outside of Canada and, following the Effective Time, the majority of its directors and officers, and certain of its experts, are expected
to reside outside of Canada. Accordingly, it may not be possible for Shareholders to effect service of process within Canada upon the
Combined Company or the majority of its directors, officers or experts, or to enforce judgments obtained in Canadian courts against the
Combined Company or the majority of its directors, officers or experts.
The consummation
of the Arrangement may result in one or more ratings organizations taking actions which may adversely affect the Combined Company's business,
financial condition and operating results, as well as the market price of the Combined Company’s common stock
Rating organizations
regularly analyze the financial performance and condition of companies and may reevaluate the Combined Company's credit ratings following
the consummation of the Arrangement. Factors that may impact the Combined Company's credit ratings include debt levels, planned asset
purchases or sales and near-term and long-term production growth, opportunities, liquidity, asset quality, cost structure, product mix
and commodity pricing levels. If a ratings downgrade were to occur in connection with the Arrangement, the Combined Company could experience
higher borrowing costs in the future and more restrictive covenants which would reduce profitability and diminish operational flexibility.
There can be no assurance that any of Coeur’s current ratings will remain in effect following the consummation of the Arrangement
for any given period of time or that a rating will not be lowered by a rating agency if, in its judgment, circumstances so warrant.
The trading
price and volume of the Combined Company’s common stock may be volatile following the Arrangement
The trading price
and volume of the Combined Company’s common stock may be volatile following completion of the Arrangement. The stock markets in
general have experienced extreme volatility that has often been unrelated to the operating performance of particular companies. These
broad market fluctuations may adversely affect the trading price of the Combined Company’s common stock. As a result, former Shareholders
may suffer a loss on their investment. Many factors may impair the market for the Combined Company’s common stock and the ability
of investors to sell shares at an attractive price, and could also cause the market price and demand for the Combined Company’s
common stock to fluctuate substantially, which may negatively affect the price and liquidity of the Combined Company’s common stock.
Many of these factors and conditions are beyond the control of the Combined Company or the Combined Company’s stockholders.
The Combined
Company will be an international company and will be exposed to political and social risks associated with its foreign operations
Following
the Arrangement, a significant portion of the Combined Company’s revenues are expected to be generated by operations in
Mexico. Exploration, development, production and closure activities in many countries are potentially subject to heightened
political, sovereign and social risks that are beyond the Combined Company’s control and could result in increased costs,
capacity constraints and potential disruptions to the Combined Company’s business. These risks include the possible unilateral
cancellation or forced renegotiation of contracts in which the Combined Company, directly or indirectly, may have an interest,
unfavourable changes in foreign laws and regulations, royalty and tax increases (including taxes associated with the import or
export of goods), risks associated with tax recovery and collection process, aggressive or punitive tax audits, policy-driven
interference with or moratoriums on processing of permit applications or granting water or mineral concessions, erection of trade
barriers, including tariffs and duties, claims by governmental entities or indigenous communities, changes to mining and related
laws impacting current and future operations, expropriation or nationalization of property and other risks arising out of foreign
sovereignty over areas in which the
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Combined Company’s operations are conducted. Any material adverse changes in government
policies or legislation in Mexico or any other country where the Combined Company has economic interests that affect mining
or mineral exploration activities may affect the viability and profitability of the Combined Company following the Arrangement.
There is no assurance that foreign governments will not in the future adopt different regulations, policies or interpretations with
respect to, but not limited to, foreign ownership of mineral resources, royalty rates, taxation, exchange rates, environmental
protection, labor relations, repatriation of income or return of capital, restrictions on production or processing, price controls,
export controls, currency remittance, or obligations of the Combined Company under its respective mining codes and stability
conventions. The right to import and export gold and silver may depend on obtaining certain licenses and quotas, which could be
delayed or denied at the discretion of the relevant regulatory authorities, or could become subject to new taxes, tariffs or duties
imposed by foreign jurisdictions, which could have a material adverse effect on the Combined Company’s business, financial
condition, or future prospects. In addition, the Combined Company’s rights under local law may be less secure in countries
where judicial systems are susceptible to manipulation and intimidation by governmental agencies, non-governmental organizations or
civic groups. Any of these developments could require the Combined Company to curtail or terminate operations or otherwise adversely
modify operations at its mines, incur significant costs to renegotiate contracts, meet newly-imposed environmental or other
standards, pay greater royalties or higher prices for labor or services and recognize higher taxes, address aggressive or punitive
tax audit assessments including through litigation, or experience significant delays or obstacles in the recovery of VAT or income
tax refunds owed, which could materially and adversely affect financial condition, results of operations and cash flows.
The Combined
Company’s increased foreign operations may further expose the Combined Company to economic and operational risks
The Combined
Company’s increased foreign operations further expose it to economic and operational risks. Local economic conditions, as well
as epidemics, pandemics or natural disasters, can cause shortages of skilled workers and supplies, increase costs and adversely affect
the security of operations. In addition, higher incidences of criminal activity and violence in the area of some of the Combined Company’s
foreign operations, including drug cartel-related violence in Mexico, could adversely affect the Combined Company’s ability to
operate in an optimal fashion and may impose greater risks of extortion and theft, greater risks to personnel, and greater risks to the
supply of goods and services to operations and property of the Combined Company. These conditions, including security concerns in certain
communities surrounding the Las Chispas mine or, following the Arrangement, the Palmarejo complex, impacting third-party deliveries of
supplies to such locations, could adversely impact the Combined Company’s operations and lead to lower productivity and higher
costs, which would adversely affect results of the Combined Company’s operations and cash flows.
In addition,
acts of civil disobedience are not uncommon in areas of Mexico where the Combined Company’s operations or projects are located.
In recent years, many mining companies have been the targets of actions to restrict their legally entitled access to mining concessions
or property. Such acts of civil disobedience often occur with no warning and can result in significant direct and indirect costs. There
can be no assurance that there will be no disruptions to site access in the future, which could adversely affect the business of the
Combined Company.
The Combined
Company will face increased exposure to mining law reforms in Mexico
Following the
Arrangement, a significant portion of the Combined Company’s operations are expected to occur in Mexico. On May 8, 2023, the Mexican
Congress instituted a number of changes to the Mexican mining law and other related laws, including the process by which mining concessions
are granted, the term and scope of mining concessions, the legal nature of mining activities and the ability to transfer title to mining
concessions. Given that the legislation contains substantial reforms, and associated regulations have not yet been enacted to give effect
to the more general provisions of the legislation for the purpose of interpretation and clarification on operating parameters, it is
too early to know how the mining law reforms will be interpreted and apply to the Combined Company’s increased operations in Mexico.
As such, the legislation and its implementation has not yet been advanced to the level of clarity required for the Combined Company to
analyze all potential business impacts. Until such time as a full analysis of the legislation and the pending regulation is complete
or the outcome of certain unconstitutionality actions are known, there can be no assurance that the mining law reforms will not have
a material impact on the Combined Company’s operations or plans.
Continuation
of the Combined Company’s mining operations is dependent on the availability of sufficient and affordable water supplies
The Combined
Company’s mining operations will require significant quantities of water for mining, ore processing and related support
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facilities.
In particular, the Combined Company’s properties in Mexico (including through the La Palmarejo
complex following the Arrangement) will be in areas where water is scarce and competition among users for continuing access to
water is significant. Continuous production and mine development is dependent on the Combined Company’s ability to acquire and
maintain water rights and claims and to defeat claims adverse to current water uses in legal proceedings. For example, in January 2024,
the Supreme Court of Justice of the Nation issued a ruling that invalidated certain non-material surface water rights previously utilized
at Coeur’s La Palmarejo complex. Although each of Coeur’s operating mines currently has sufficient water rights and claims
to cover its operational demands, the potential outcome of pending or future legal proceedings relating to enforcement of water rights,
claims and uses, or potential pressure from other users of water, government agencies and officials, and/or non-governmental organizations
to limit the amount of water made available to or used for mining activities, regardless of legally valid water rights, is unpredictable.
Water
shortages may also result from weather or environmental and climate impacts outside of the Combined Company’s control. Shortages
in water supply could result in production and processing interruptions. In addition, the scarcity of water in certain regions could
result in increased costs to obtain sufficient quantities of water to conduct the Combined Company’s operations. The loss of some
or all water rights, ongoing litigation to enforce existing water rights, ongoing shortages of water to which the Combined Company has
rights and/or significantly higher costs to obtain sufficient quantities of water could result in the Combined Company’s inability
to maintain production at current or expected levels, require the Combined Company to curtail or shut down mining operations or could
prevent the Combined Company from pursuing expansion or development opportunities, which could adversely affect the results of operations
and financial condition of the Combined Company. Laws and regulations may be introduced in some jurisdictions in which the Combined Company
operates which could also limit access to sufficient water resources, adversely affecting the Combined Company’s operations or
its expansion or development plans.
Recent amendments
to mining, water and environmental laws in Mexico, and the subsequent corresponding regulations thereto, could impose additional restrictions
on the Combined Company’s ability to obtain and maintain mining and water rights and operate in Mexico, among other potentially
adverse provisions. Legal actions challenging the validity and implementation of these recent amendments have been filed by various groups
and the proceedings remain ongoing.
Mexican
inflation, restrictive exchange control policies and fluctuations in the peso exchange rate may adversely affect the Combined Company’s
financial condition and results of operations
A substantial
portion of the Combined Company’s costs will be denominated in pesos, given the increased operations of the Combined Company’s
operations in Mexico. Accordingly, when inflation in Mexico increases without a corresponding depreciation of the peso, the net income
generated by the Mexican operations of the Combined Company may be adversely affected. The peso has been subject in the past to significant
volatility, which may not have been proportionate to the inflation rate and may not be proportionate to the inflation rate in the future.
Currently, the Mexican government does not restrict the ability of Mexican companies or individuals to convert pesos into dollars or
other currencies. While it is not expected the Mexican government to impose any restrictions or exchange control policies in the future,
it is an area that will be closely monitored. There can be no assurance that the Mexican government will maintain its current policies
with regard to the peso or that the peso’s value will not fluctuate significantly in the future. The imposition of exchange control
policies could impair the Combined Company’s ability to obtain imported goods and to meet its U.S. dollar-denominated obligations
and could have an adverse effect on the Combined Company’s business and financial condition.
The future
results of the Combined Company following the Arrangement will suffer if the Combined Company does not effectively manage its expanded
operations
Following
the Arrangement, the size of the business of the Combined Company will increase significantly. The Combined Company’s future
success will depend, in part, upon its ability to manage the expanded business, which will pose substantial challenges for
management, including challenges related to the management and monitoring of new operations and associated increased costs and
complexity. The Combined Company may also face increased scrutiny from governmental authorities as a result of the significant
increase in the size of its business. There can be no assurances that the Combined Company will be successful or that it will
realize the expected operating efficiencies, cost savings, revenue enhancements or other benefits currently anticipated from the
Arrangement.
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Risks
Relating to SilverCrest
If the Arrangement
is not completed, SilverCrest will continue to face the risks that it currently faces with respect to its affairs, business and operations
and future prospects. Such risk factors are set forth and described in the Company AIF and other documents incorporated by reference
herein.
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INFORMATION
CONCERNING SILVERCREST
The Company was
incorporated on June 23, 2015 under the BCBCA under the name “1040669 B.C. Ltd.”. The Company changed its name to “SilverCrest
Metals Inc.” on August 11, 2015. Upon the Company's incorporation on June 23, 2015, the Company was a wholly-owned subsidiary of
SilverCrest Mines Inc., and was established as part of an arrangement completed under the BCBCA on October 1, 2015, pursuant
to which First Majestic Silver Corp. acquired SilverCrest Mines Inc. after the Company was spun off from SilverCrest Mines Inc. to the
former shareholders of SilverCrest Mines Inc.
The Company is
a Canadian-based precious metals producer headquartered in Vancouver, British Columbia, with an ongoing initiative to increase its silver-gold
assets by expanding current resources and reserves, acquiring, discovering, developing and operating high value precious metal projects
in the Americas. The Company’s principal focus is operating its Las Chispas Operation located near Hermosillo, Sonora, Mexico.
The Company has a portfolio of three other mineral exploration properties in Sonora, Mexico, comprised of El Picacho, Cruz de Mayo, and
Angel de Plata properties.
The SilverCrest
Shares are listed for trading on the TSX under the symbol “SIL” and the NYSE American under the symbol “SILV”.
Following the completion of the Arrangement, the Company will be a wholly-owned subsidiary of Coeur and the SilverCrest Shares will be
delisted from the TSX and NYSE American.
The head office
of the Company is located at Suite 501, 570 Granville Street, Vancouver, British Columbia, V6C 3P1. The registered office of the Company
is located at 19th Floor, 885 West Georgia Street, Vancouver, British Columbia, V6C 3H4.
Documents Incorporated
by Reference
Information regarding
the Company has been incorporated by reference in the Circular from documents filed by the Company with securities commissions or similar
authorities in Canada. Copies of the documents incorporated in the Circular by reference regarding the Company may be obtained on request
without charge from Bernard Poznanski, Corporate Secretary of the Company, at 19th Floor, 885 West Georgia Street, Vancouver,
British Columbia, V6C 3H4, and are also available electronically under the Company’s profile at www.sedarplus.ca and at www.sec.gov.
The following
documents, filed with the securities regulatory authorities in Canada and with the SEC, are specifically incorporated by reference into,
and form a part, of the Circular:
| (b) | the
Company Annual Financial Statements and the reports by the Company’s auditors thereon; |
| (c) | the
Company Annual MD&A; |
| (d) | the
Company Interim Financial Statements; |
| (e) | the
management’s discussion and analysis of the Company for the three and nine months ended
September 30, 2024; |
| (f) | the
management information circular of the Company dated April 18, 2024 in connection with the
annual general meeting of Shareholders held on June 12, 2024; and |
| (g) | the
material change report of the Company dated October 9, 2024 in respect of the entering into
of the Arrangement Agreement. |
Any documents
of the type described in Section 11.1 of Form 44-101F1 — Short Form Prospectus filed by the Company with any securities
regulatory authorities in Canada subsequent to the date of the Circular and prior to the Effective Date will be deemed to be incorporated
by reference in the Circular.
Any
statement contained in a document incorporated or deemed to be incorporated by reference in this Circular will be deemed to be
modified or superseded for the purposes of the Circular to the extent that a statement contained in this Circular or in any
other
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subsequently filed document which also is, or is deemed to be, incorporated by reference in this Circular modifies or
supersedes such statement. The modifying or superseding statement need not state that it has modified or superseded a prior
statement or include any other information set forth in the document that it modifies or supersedes. The making of a modifying or
superseding statement will not be deemed an admission for any purposes that the modified or superseded statement, when made,
constituted a misrepresentation, an untrue statement of a material fact or an omission to state a material fact that is required to
be stated or that is necessary to make a statement not misleading in light of the circumstances in which it was made. Any statement
so modified or superseded will not be deemed, except as so modified or superseded, to constitute a part of the Circular.
Information contained
in or otherwise accessed through the Company’s website (www.silvercrestmetals.com), or any other website, does not form
part of the Circular. All such references to the Company’s website are inactive textual references only.
Price Range and
Trading Volume
The SilverCrest
Shares currently trade on the TSX in Canada under the symbol “SIL” and on the NYSE American under the symbol “SILV”.
The following
tables shows the high and low trading prices and monthly trading volume of the SilverCrest Shares on the TSX and the NYSE American, respectively,
for the 12-month period preceding the date of this Circular.
TSX
| Month |
High
(C$) |
Low
(C$) |
Volume |
| January
2024 |
$8.82 |
$7.39 |
4,320,568 |
| February
2024 |
$7.65 |
$6.755 |
3,620,047 |
| March
2024 |
$9.43 |
$6.85 |
6,234,512 |
| April
2024 |
$11.81 |
$9.09 |
10,227,038 |
| May
2024 |
$12.70 |
$11.03 |
8,438,039 |
| June
2024 |
$12.15 |
$10.83 |
6,490,725 |
| July
2024 |
$14.04 |
$11.03 |
6,704,981 |
| August
2024 |
$13.56 |
$10.36 |
7,196,846 |
| September
2024 |
$13.845 |
$10.01 |
8,517,192 |
| October
2024 |
$16.06 |
$12.50 |
10,226,903 |
| November
2024 |
$14.57 |
$13.00 |
4,540,939 |
| December
2024 |
$16.35 |
$12.84 |
3,341,345 |
| January
1 – 7, 2025 |
$13.86 |
$14.15 |
775,947 |
NYSE American
| Month |
High
(US$) |
Low
(US$) |
Volume |
| January
2024 |
$6.64 |
$5.48 |
20,499,218 |
| February
2024 |
$5.70 |
$4.83 |
18,848,115 |
| March
2024 |
$7.00 |
$5.03 |
38,633,428 |
| April
2024 |
$8.65 |
$6.69 |
46,339,580 |
| May
2024 |
$9.52 |
$8.06 |
37,402,642 |
| June
2024 |
$8.99 |
$7.86 |
27,020,846 |
| July
2024 |
$10.27 |
$8.05 |
29,735,833 |
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| Month |
High
(US$) |
Low
(US$) |
Volume |
| August
2024 |
$9.85 |
$7.52 |
36,820,773 |
| September
2024 |
$10.27 |
$7.38 |
31,633,111 |
| October
2024 |
$11.65 |
$9.23 |
69,853,250 |
| November
2024 |
$10.42 |
$9.30 |
48,885,252 |
| December
2024 |
$11.58 |
$8.92 |
33,228,193 |
| January
1 – 7, 2025 |
$9.81 |
$9.57 |
7,291,325 |
The closing price
of SilverCrest Shares on the TSX and the NYSE American on October 3, 2024, the last trading day prior to the announcement of the Arrangement,
was C$12.59 and US$9.29, respectively. The closing price of SilverCrest Shares on the TSX and the NYSE American on January 7, 2025, the
last trading day prior to the date of the Circular, was C$13.96 and US$9.71, respectively.
Prior Sales
The following
SilverCrest Shares or other securities of the Company have been issued by the Company during the 12-month period preceding the date of
this Circular:
| Month
of Issue |
Type
of Security |
Issue/Exercise
Price (C$) |
Number
Issued |
| January 2025 |
Common Shares |
$9.79 |
1,666 |
| December 2024 |
Common Shares |
$8.24 - $12.53 |
168,452 |
| November 2024 |
Common Shares |
$7.13 - $11.14 |
363,465 |
| September 2024 |
Common Shares |
$8.24 - $11.14 |
36,117 |
| August 2024 |
Common Shares |
$8.21 - $10.87 |
66,634 |
| July 2024 |
Common Shares |
$8.21 - $10.87 |
26,082 |
| June 2024 |
Restricted Share Units |
$11.34 |
5,300 |
| June 2024 |
Restricted Share Units |
$11.34 |
5,300 |
| June 2024 |
Stock Options |
$11.31 |
13,500 |
| June 2024 |
Common Shares |
$8.21 - $10.87 |
257,533 |
| May 2024 |
Common Shares |
$8.21 - $11.14 |
1,009,663 |
| April 2024 |
Common Shares |
$4.54 - $9.79 |
196,917 |
| March 2024 |
Common Shares |
$4.54 - $8.21 |
125,916 |
| February 2024 |
Common Shares |
$8.85 |
2,925 |
| February 2024 |
Performance Share Units |
$7.57 |
96,900 |
| February 2024 |
Restricted Share Units |
$7.57 |
381,650 |
| February 2024 |
Deferred Share Units |
$7.57 |
118,800 |
| February
2024 |
Stock
Options |
$7.43 |
620,800 |
Previous Distribution
For the five
years preceding the date of this Circular, SilverCrest has completed the following distributions of SilverCrest Shares:
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| Time
Period |
Description |
Number
Issued |
Issue/Exercise
Price (C$) |
Proceeds
(C$) |
| January 1 – 7, 2025 |
Exercise of SilverCrest Options |
1,666 |
$9.79 |
$16,310 |
| During the year
ended December 31, 2024 |
Exercise of SilverCrest Options |
2,250,779 |
$8.28 |
$18,637,717 |
| Settlement of SilverCrest
RSUs |
2,925 |
N/A |
N/A |
| During the year ended December
31, 2023 |
Exercise of SilverCrest Options |
1,282,750 |
$3.34 |
$4,282,410 |
| During the year ended December
31, 2022 |
Exercise of SilverCrest Options |
1,507,500 |
$2.13 |
$3,210,325 |
| During the year
ended December 31, 2021 |
Prospectus offering of SilverCrest
Shares |
15,007,500 |
$11.60 |
$174,146,430 |
| Exercise of SilverCrest Options |
1,311,633 |
$2.63 |
$3,452,955 |
| During the year
ended December 31, 2020 |
Private placements of SilverCrest
Shares |
18,881,366 |
$7.48 |
$141,210,049 |
| Exercise of SilverCrest Options |
2,927,250 |
$1.63 |
$4,756,990 |
| Exercise of SilverCrest Share
purchase warrants |
50,000 |
$4.03 |
$201,500 |
| During
the year ended December 31, 2019 |
Prospectus offerings and
private placements of SilverCrest Shares |
17,856,300 |
$6.85 |
$122,255,855 |
| Exercise of SilverCrest Options |
795,000 |
$1.33 |
$1,057,600 |
| Exercise
of SilverCrest Share purchase warrants |
3,959,804 |
$1.50 |
$5,931,471 |
Dividends or Capital
Distributions
Since its organization,
the Company has not paid any dividends on the SilverCrest Shares and there is no current intent to pay dividends in the future. SilverCrest
intends to retain all future earnings, if any, and other cash resources for the future operation and development of its business, and
accordingly, does not intend to declare or pay any cash dividends in the foreseeable future. Payment of any future dividends will be
at the discretion of the Board after taking into account many factors including the Company’s operating results, financial condition
and current and anticipated cash needs.
Expenses
The estimated
fees, costs and expenses of the Company in connection with the Arrangement, including, without limitation, fees of the financial advisor,
filing fees, legal and accounting fees, insurance and printing and mailing costs are expected to be approximately US$27.0 million.
Interests of Experts
The following
persons and companies have prepared certain sections of this Circular and/or Appendices attached hereto as described below, or are named
as having prepared or certified a report, statement or opinion in or incorporated by reference in this Circular.
| Name
of Expert |
Nature
of Relationship |
| Scotiabank |
Financial
advisor to the Special Committee |
| Cormark |
Financial
advisor to SilverCrest |
| Raymond
James |
Financial
advisor to SilverCrest |
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| Name
of Expert |
Nature
of Relationship |
| PricewaterhouseCoopers
LLP |
Auditors
of SilverCrest |
| Cassels
Brock & Blackwell LLP |
Canadian
legal counsel to SilverCrest |
| Paul,
Weiss, Rifkind, Wharton & Garrison LLP |
U.S.
legal counsel to SilverCrest |
| Kevin
Murray, P. Eng., Scott Weston, P. Geo., Wynand Marthinus Marx, Fellow SAIMM, Patrick Langlais, P. Eng., Michael Verreault, P. Eng.,
Ben Peacock, P. Eng., Jarita Barry, P. Geo., David Burga, P. Geo., Eugene J. Puritch, P. Eng., William Stone, P. Geo., Yungang Wu,
P. Geo., Christopher Lee, P. Eng., Humberto F. Preciado, P.E. |
Qualified persons with respect
to the Company Technical Report |
To the knowledge
of the Company, neither Scotiabank, Cormark, Raymond James, nor any of the designated professionals thereof held securities representing
more than 1% of all issued and outstanding SilverCrest Shares as at the date of the respective Fairness Opinions, and none of the persons
above is or is expected to be elected, appointed or employed as a director, officer or employee of the Company or of any associate or
affiliate of the Company.
PricewaterhouseCoopers
LLP has advised that it is independent of the Company within the meaning of the Chartered Professional Accountants of British Columbia
Code of Professional Conduct, and within the meaning of the U.S. Securities Act and the applicable rules and regulations thereunder adopted
by the SEC and the PCAOB.
To the knowledge
of the Company, the partners and associates of Cassels Brock & Blackwell LLP, as a group, own, directly or indirectly, in the aggregate
less than 1% of all of the issued and outstanding SilverCrest Shares as of the date of this Circular.
N. Eric Fier,
CPG, P.Eng., Chief Executive Officer and a director of the Company, has reviewed and approved all scientific and technical information
relating to the Company contained in this Circular or in a document incorporated by reference herein. To the Company’s knowledge,
Mr. Fier beneficially owns, directly or indirectly, approximately 1.4% of the issued and outstanding SilverCrest Shares as of the Record
Date. See also “The Arrangement – Interests of Certain Persons in the Arrangement – Securities Held by Directors
and Senior Officers of the Company”.
Statement of Rights
Securities legislation
in the provinces and territories of Canada provides Securityholders with, in addition to any other rights they may have at law, one or
more rights of rescission, price revision or to damages, if there is a misrepresentation in a circular or notice that is required to
be delivered to those Securityholders. However, such rights must be exercised within prescribed time limits. Securityholders should refer
to the applicable provisions of the securities legislation of their province or territory for particulars of those rights or consult
a lawyer.
INFORMATION
CONCERNING COEUR
Information regarding
Coeur including risk factors before and after the Arrangement is contained in Appendix H “Information Concerning Coeur”
attached to this Circular. The information concerning Coeur contained in this Circular has been provided by Coeur for inclusion in this
Circular. Although the Company has no knowledge that any statement contained herein taken from, or based on, such information and records
or information provided by Coeur are untrue or incomplete, the Company assumes no responsibility for the accuracy of the information
contained in such documents, records or information or for any failure by Coeur to disclose events which may have occurred or may affect
the significance or accuracy of any such information but which are unknown to the Company.
INFORMATION
CONCERNING THE COMBINED COMPANY
On completion
of the Arrangement, Coeur will continue to be a corporation incorporated under and governed by the DGCL. On the Effective Date, Coeur,
through Coeur Canadian Sub, will own all of the SilverCrest Shares and SilverCrest will be an indirect wholly-owned subsidiary of Coeur.
Following completion of the Arrangement, existing Shareholders and Coeur Stockholders are expected to own approximately 37% and 63% of
the Combined Company on a fully-diluted basis, respectively, in each case based on the number of SilverCrest Shares and Coeur Shares
issued and outstanding on October 3, 2024.
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For further information
regarding the Combined Company after the completion of the Arrangement, please see Appendix I “Information Concerning the Combined
Company” attached to this Circular.
CERTAIN
CANADIAN FEDERAL INCOME TAX CONSIDERATIONS
The following
is, as of the date hereof, a summary of the principal Canadian federal income tax considerations under the Tax Act in respect of the
Arrangement that are generally applicable to a beneficial owner of SilverCrest Shares who at all relevant times and for purposes of the
Tax Act: (a) deals at arm’s length with SilverCrest and Coeur; (b) is not and will not be affiliated with SilverCrest or Coeur;
and (c) holds SilverCrest Shares and will hold any Coeur Shares received pursuant to the Arrangement as capital property (each such owner
in this section, a “Holder”).
The SilverCrest
Shares and Coeur Shares generally will be considered capital property to a Holder for purposes of the Tax Act unless the Holder holds
such shares in the course of carrying on a business of buying and selling securities or the Holder has acquired or holds such shares
in a transaction or transactions considered to be an adventure or concern in the nature of trade.
This summary
is not applicable to Persons holding SilverCrest Options, SilverCrest PSUs, SilverCrest RSUs, SilverCrest DSUs or other conversion or
exchange rights to acquire SilverCrest Shares, and the tax considerations relevant to such holders are not discussed herein. Any such
Persons referenced above should consult their own tax advisor with respect to the tax consequences of the Arrangement.
In addition,
this summary is not applicable to a Holder: (a) that is a “financial institution” (as defined in the Tax Act for the purposes
of the “mark-to-market rules”); (b) that is a “specified financial institution” (as defined in the Tax Act);
(c) an interest in which is, or whose SilverCrest Shares are, a “tax shelter investment” (as defined in the Tax Act); (d)
who makes, or has made, a “functional currency” election under section 261 of the Tax Act; (e) who acquired SilverCrest Shares
under an employee stock option plan or other equity based employment compensation arrangement; (f) that has entered into or will enter
into a “synthetic disposition agreement”, or a “derivative forward agreement”, as defined in the Tax Act with
respect to SilverCrest Shares or Coeur Shares; (g) that is a “foreign affiliate” (as defined in the Tax Act) of a taxpayer
resident in Canada; (h) that receives dividends on its Coeur Shares under or as part of a “dividend rental arrangement” (as
defined in the Tax Act); (i) that is exempt from tax under Part I of the Tax Act or (j) in relation to which Coeur or any of its subsidiaries
is or will be a “foreign affiliate” (as defined in the Tax Act). Such Holders should consult their own tax advisors.
Additional
considerations not discussed herein may apply to a Holder that is a corporation resident in Canada that is or becomes (or does not
deal at arm’s length for purposes of the Tax Act with a corporation resident in Canada that is or becomes), as part of a
transaction or event or series of transactions or events that includes the acquisition of the Coeur Shares, controlled by a
non-resident person or a group of non-resident persons that do not deal with each other at arm’s length for purposes of the
foreign affiliate dumping rules in section 212.3 of the Tax Act.
This summary
is based on the current provisions of the Tax Act in force as of the date hereof, the regulations thereunder (the “Regulations”),
and counsel’s understanding of the current published administrative policies and assessing practices of the CRA publicly available
prior to the date hereof. This summary also takes into account all specific proposals to amend the Tax Act that have been publicly announced
by or on behalf of the Minister of Finance (Canada) prior to the date hereof (the “Proposed Amendments”) and assumes
that the Proposed Amendments will be enacted in the form proposed. No assurance can be given that the Proposed Amendments will be enacted
in the form proposed, or at all. Except for the Proposed Amendments, this summary does not otherwise take into account or anticipate
any other changes in Law, whether by judicial, governmental or legislative decision or action or changes in the administrative policies
or assessing practices of the CRA, nor does it take into account provincial, territorial or foreign income tax legislation or considerations,
which may differ from the Canadian federal income tax considerations discussed below.
This summary
is of a general nature only and is not exhaustive of all possible Canadian federal income tax considerations. This summary is not, and
should not be construed as, legal, business or tax advice to any particular Holder and no representation with respect to the tax consequences
to any particular Holder is made. Accordingly, all Holders should consult their own tax advisors regarding the Canadian federal income
tax consequences of the Arrangement applicable to their particular circumstances, and any other consequences to them of such transactions
under Canadian federal, provincial, local and foreign tax Laws.
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Currency
Conversion
Subject to certain
exceptions that are not discussed herein, for the purposes of the Tax Act, all amounts relating to the acquisition, holding or disposition
of securities (including dividends, adjusted cost base and proceeds of disposition) must be expressed in Canadian dollars. Amounts denominated
in foreign currency, must be converted into Canadian dollars, generally based on the rate quoted by the Bank of Canada for the exchange
of the foreign currency on the date such amounts arise, or such other rate of exchange as is acceptable to the Minister of National Revenue
(Canada).
Holders
Resident in Canada
This portion
of the summary is generally applicable to a Holder who, at all relevant times, for purposes of the application of the Tax Act and any
applicable income tax treaty: (i) is, or is deemed to be, resident in Canada; and (ii) is not exempt from tax under Part I of the Tax
Act (a “Resident Holder”).
Certain Resident
Holders whose SilverCrest Shares might not otherwise qualify as capital property may, in certain circumstances, be eligible to make an
irrevocable election in accordance with subsection 39(4) of the Tax Act to have their SilverCrest Shares (but not Coeur Shares), and
every other “Canadian security” (as defined in the Tax Act) owned by such Resident Holder in the taxation year in which the
election is made and in all subsequent taxation years, be deemed to be capital property. Resident Holders should consult their own tax
advisors as to whether they hold or will hold their SilverCrest Shares and Coeur Shares as capital property and whether such election
can or should be made in respect of their SilverCrest Shares.
Disposition
of SilverCrest Shares Pursuant to the Arrangement
Resident Holders
(other than Dissenting Resident Holders) will dispose of their SilverCrest Shares in exchange for Coeur Shares pursuant to the Arrangement.
A Resident Holder will realize a capital gain (or capital loss) equal to the amount, if any, by which the aggregate fair market value
of the Coeur Shares received exceeds (or is less than) the total of the adjusted cost base, as defined in the Tax Act, to the Resident
Holder of their SilverCrest Shares immediately before the Effective Date of the Arrangement and the Resident Holder’s reasonable
costs of disposition. For a description of the tax treatment of capital gains and capital losses, See “Holders Resident in Canada
– Taxation of Capital Gains and Capital Losses”.
The cost to
a Resident Holder of each Coeur Share acquired under the Arrangement will be equal to the fair market value of such Coeur Share at
the time of acquisition. For the purpose of determining the adjusted cost base of a Coeur Share to a Resident Holder, when a Coeur
Share is acquired, the cost of the newly acquired Coeur Share will be averaged with the adjusted cost base of all Coeur
Shares (if any) owned by the Resident Holder as capital property immediately before that acquisition.
Dividends
on Coeur Shares
A Resident Holder
will be required to include in computing income for a taxation year the amount of dividends, if any, received or deemed to be received
in respect of Coeur Shares, including amounts withheld for foreign withholding tax, if any. For individuals (including a trust), such
dividends will not be subject to the gross-up and dividend tax credit rules under the Tax Act normally applicable to taxable dividends
received by an individual from a taxable Canadian corporation. A Resident Holder that is a corporation will generally not be entitled
to deduct the amount of such dividends in computing its taxable income.
Subject to the
detailed rules in the Tax Act, a Resident Holder may be entitled to a foreign tax credit or deduction for any foreign withholding tax
paid with respect to dividends received by the Resident Holder on the Coeur Shares. Resident Holders should consult their own tax advisors
with respect to the availability of a foreign tax credit or deduction having regard to their own particular circumstances.
Dispositions
of Coeur Shares
A Resident Holder
that disposes or is deemed to dispose of a Coeur Share in a taxation year will realize a capital gain (or a capital loss) equal to the
amount by which the proceeds of disposition of the Coeur Share exceeds (or is exceeded by) the aggregate of the Resident Holder’s
adjusted cost base of such Coeur Share immediately before the disposition and any reasonable costs of disposition. For a
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description
of the tax treatment of capital gains and capital losses see “Holders Resident in Canada – Taxation of Capital Gains and
Capital Losses”.
In certain circumstances
U.S. tax may be required to be paid by a Resident Holder in connection with the realization of a capital gain on the disposition of Coeur
Shares. See the discussion under the heading “Certain United States Federal Income Tax Considerations”. Resident Holders
should consult their own tax advisors regarding their eligibility for such deductions or credits.
Taxation
of Capital Gains and Capital Losses
For capital gains
and capital losses realized on or after June 25, 2024, under Proposed Amendments released on September 23, 2024 (the "Capital
Gains Tax Proposals"), and subject to certain transitional rules discussed below, generally, a Resident Holder is required to
include in computing its income for a taxation year two-thirds of the amount of any such capital gain (a "taxable capital gain")
realized in the year, and is required to deduct two-thirds of the amount of any such capital loss (an "allowable capital loss")
sustained in a taxation year from taxable capital gains realized in the year by such Resident Holder. However, under the Capital Gains
Tax Proposals, a Resident Holder that is an individual (excluding most types of trusts) is effectively required to include in income
only one-half of net capital gains realized (including net capital gains realized indirectly through a trust or partnership) in a taxation
year up to a maximum of $250,000, with the two-thirds inclusion rate applying to the portion of net capital gains realized in the year
(and on or after June 25, 2024) that exceed $250,000. Allowable capital losses in excess of taxable capital gains realized in a taxation
year may be carried back and deducted in any of the three preceding taxation years or carried forward and deducted in any subsequent
taxation year against net taxable capital gains realized in such year to the extent and under the circumstances described in the Tax
Act (as proposed to be amended by the Capital Gains Tax Proposals).
Subject to transitional
rules in the Capital Gains Tax Proposals, for a capital gain or capital loss realized prior to June 25, 2024, only one-half of such capital
gain would be included in income as a taxable capital gain and one-half of such capital loss would constitute an allowable capital loss.
Under the
Capital Gains Tax Proposals, two different inclusion and deduction rates (or a blended rate) would apply for taxation years that
begin before and end on or after June 25, 2024 (the "Transitional Year"). As a result, for its Transitional Year, a
Resident Holder would be required to separately identify capital gains and capital losses realized before June 25, 2024
("Period 1") and those realized on or after June 25, 2024 ("Period 2"). Capital gains and capital
losses from the same period would first be netted against each other. A net capital gain (or net capital loss) would arise if
capital gains (or capital losses) from one period exceed capital losses (or
capital gains) from that same period. A Resident Holder would effectively be subject to the higher inclusion and deduction rate of
two-thirds in respect of its net capital gains (or net capital losses) arising in Period 2, to the extent that these net capital
gains (or net capital losses) exceed any net capital losses (or net capital gains) incurred in Period 1. Conversely, a Resident
Holder would effectively be subject to the lower inclusion and deduction rate of one-half in respect of its net capital gains (or
net capital losses) arising in Period 1, to the extent that these net capital gains (or net capital losses) exceed any net capital
losses (or net capital gains) incurred in Period 2.
The annual $250,000
threshold for a Resident Holder that is an individual (other than most types of trusts) would be fully available in 2024 without proration
and would apply only in respect of net capital gains realized in Period 2 less any net capital loss from Period 1. Certain other limitations
to the $250,000 threshold may apply.
The Capital Gains
Tax Proposals also contemplate adjustments of carried forward or carried back allowable capital losses to account for changes in the
relevant inclusion and deduction rates.
The foregoing
summary only generally describes the considerations applicable under the Capital Gains Tax Proposals, and is not an exhaustive summary
of the considerations that could arise in respect of the Capital Gains Tax Proposals. Furthermore, the Capital Gains Tax Proposals could
be subject to further changes. Resident Holders should consult their own tax advisors with regard to the Capital Gains Tax Proposals.
The amount of
any capital loss realized on the disposition of a share by a Resident Holder that is a corporation may, to the extent and under the circumstances
specified by the Tax Act, be reduced by the amount of dividends received or deemed to have been received by such Resident Holder on such
share (or on a share for which such a share is substituted or exchanged). Similar rules may apply where a Resident Holder that is a corporation
is a member of a partnership or a beneficiary of a trust that owns any such shares,
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directly or indirectly, through a partnership or
trust. Resident Holders to whom these rules may be relevant should consult their own tax advisors.
Alternative
Minimum Tax
A capital gain
realized by a Resident Holder who is an individual (including certain trusts) may give rise to liability for alternative minimum tax
under the Tax Act.
Additional
Refundable Tax
A Resident Holder
that is a “Canadian-controlled private corporation” (as defined in the Tax Act) (a “CCPC”), or a “substantive
CCPC” (as defined in the Tax Act) at any time in the year, may be required to pay an additional tax (refundable in certain circumstances)
on certain investment income, which includes taxable capital gains, interest, dividends or deemed dividends not deductible in computing
the Resident Holder’s taxable income.
Foreign
Property Information Reporting
Generally, a
Resident Holder that is a “specified Canadian entity” (as defined in the Tax Act) for a taxation year or a fiscal period
and whose total “cost amount” of “specified foreign property” (as such terms are defined in the Tax Act), including
the Coeur Shares, at any time in the year or fiscal period exceeds C$100,000 will be required to file an information return with the
CRA for the year or period disclosing prescribed information. Subject to certain exceptions, a Resident Holder generally will be a specified
Canadian entity. The Coeur Shares will be “specified foreign property” of a Resident Holder for these purposes. Penalties
may apply where a Resident Holder fails to file the required information return in respect of such Resident Holder’s “specified
foreign property” on a timely basis in accordance with the Tax Act.
The reporting
rules in the Tax Act relating to “specified foreign property” are complex and this summary does not purport to address all
circumstances in which reporting may be required by a Resident Holder. Resident Holders should consult their own tax advisors regarding
compliance with these reporting requirements.
Offshore
Investment Fund Property Rules
The Tax Act contains
rules which, in certain circumstances, may require a Resident Holder to include an amount in income in each taxation year in respect
of the acquisition and holding of Coeur Shares if (1) the value of such shares may reasonably be considered to be derived, directly or
indirectly, primarily from certain portfolio investments described in paragraph 94.1(1)(b) of the Tax Act, particularly (i) shares of
the capital stock of one or more corporations, (ii) indebtedness or annuities, (iii) interests in one or more corporations, trusts, partnerships,
organizations, funds or entities, (iv) commodities, (v) real estate, (vi) Canadian or foreign resource properties, (vii) currency of
a country other than Canada, (viii) rights or options to acquire or dispose of any of the foregoing, or (ix) any combination of the foregoing,
and (2) it may reasonably be concluded, having regard to all the circumstances, that one of the main reasons for the Resident Holder
acquiring or holding the Coeur Shares was to derive a benefit from portfolio investments in such a manner that the taxes, if any, on
the income, profits and gains from such portfolio investments for any particular year are significantly less than the tax that would
have been applicable under Part I of the Tax Act if the income, profits and gains had been earned directly by the Resident Holder.
In determining
whether these rules may apply, regard must be had to all of the circumstances, including (i) the nature, organization and operation of
any non-resident entity, including Coeur, and the form of, and the terms and conditions governing, the Resident Holder’s interest
in, or connection with, any such non-resident entity, (ii) the extent to which any income, profit and gains that may reasonably be considered
to be earned or accrued, whether directly or indirectly, for the benefit of any non-resident entity, including Coeur, are subject to
an income or profits tax that is significantly less than the income tax that would be applicable to such income, profits and gains if
they were earned directly by the Resident Holder, and (iii) the extent to which any income, profits and gains of any non-resident entity,
including Coeur, for any fiscal period are distributed in that or the immediately following fiscal period.
If applicable,
these rules would generally require a Resident Holder to include in income for each taxation year in which the Resident Holder owns a
Coeur Share (i) an imputed return for the taxation year computed on a monthly basis and determined by multiplying the Resident Holder’s
“designated cost” (as defined in the Tax Act) of the Coeur Share, as applicable, at the end of the month, by
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1/12th of the
sum of the applicable prescribed rate for the period that includes such month plus 2%, less (ii) the Resident Holder’s income for
the year (other than a capital gain) from the Coeur Share (as applicable) determined without reference to these rules. Any amount required
to be included in computing a Resident Holder’s income under these rules will be added to the adjusted cost base to the Resident
Holder of the applicable Coeur Shares.
These rules are
complex and their application and consequences depend, to a large extent, on the reasons for a Resident Holder acquiring or holding Coeur
Shares.
Eligibility
for Investment by Registered Plans
Based
on the current provisions of the Tax Act in force as of the date hereof, Coeur Shares will be qualified investments under the Tax Act
for a trust governed by a registered retirement savings plan, a registered retirement income fund, a registered education savings plan,
a registered disability savings plan, a first home savings account and a tax-free savings account (each referred to as a “Registered
Plan") and a deferred profit sharing plan, each
as defined in the Tax Act, at a particular time provided that, at such time, if the Coeur Shares are listed on a “designated stock
exchange” for purposes of the Tax Act (which currently includes the NYSE).
Notwithstanding
the foregoing, the holder, subscriber or annuitant of, or under, a Registered Plan (the “Controlling Individual”)
will be subject to a penalty tax as set out in the Tax Act in respect of Coeur Shares acquired by a Registered Plan if such shares are
a prohibited investment as set out in the Tax Act for the particular Registered Plan. A Coeur Share generally will not be a “prohibited
investment” for a Registered Plan provided the Controlling Individual deals at arm’s length with Coeur for the purposes of
the Tax Act and does not have a “significant interest” (as defined in subsection 207.01(4) the Tax Act) in Coeur. In addition,
a Coeur Share will not be a “prohibited investment” if such share is “excluded property” as defined in the Tax
Act, for the Registered Plan. Controlling Individuals should consult their own tax advisors as to whether Coeur Shares would be a prohibited
investment in their particular circumstances.
Dissenting
Resident Holders
A Resident Holder
that validly exercises Dissent Rights under the Arrangement (a “Dissenting Resident Holder”) will be deemed to have
transferred their SilverCrest Shares to SilverCrest.
The tax consequences
to a Dissenting Resident Holder in respect of their deemed transfer of SilverCrest Shares are unclear. The obligation to pay fair value
to a Dissenting Resident Holder is an obligation of SilverCrest, but the timing of the payment will not occur until after the amalgamation
(the “Amalgamation”) of SilverCrest and NorCrest Metals ULC to form a corporate entity (NorCrest Metals ULC, as such
surviving entity, “Amalco”).
Under one interpretation,
a Dissenting Resident Holder who is paid fair value of such Dissenting Resident Holder’s SilverCrest Shares by Amalco may be deemed
to have received a taxable dividend equal to the amount, if any, by which the cash received in respect of the fair value of such Dissenting
Resident Holder’s SilverCrest Shares (other than in respect of any interest awarded by the court) exceeds the paid-up capital of
such SilverCrest Shares to the Dissenting Resident Holder as determined under the Tax Act. In such circumstances, a Dissenting Resident
Holder will also realize a capital gain (or capital loss) to the extent that the proceeds of disposition, less an amount in respect of
interest, if any, awarded by a court and the amount of any deemed dividend and less any reasonable costs of disposition, exceed (or are
less than) the adjusted cost base of the Dissenting Resident Holder’s SilverCrest Shares. Any capital gain or capital loss realized
by a Dissenting Resident Holder, will be treated in the same manner as described under the heading “Holders Resident in Canada
— Taxation of Capital Gains and Capital Losses” above. In the case of a Dissenting Resident Holder who is an individual
(other than certain trusts), the Dissenting Resident Holder’s share of any dividends deemed to be received on the Resident Holder’s
SilverCrest Shares will be included in such Dissenting Resident Holder’s income and will be subject to the gross-up and dividend
tax credit rules in the Tax Act normally applicable to “taxable dividends” received from a “taxable Canadian corporation”
(each as defined in the Tax Act).
A Dissenting
Resident Holder that is a corporation will be required to include in income the Resident Holder’s share of dividends deemed to
be received on the Dissenting Resident Holder’s SilverCrest Shares but will generally be entitled to deduct such amount in computing
taxable income. In certain circumstances, subsection 55(2) of the Tax Act will treat a taxable dividend received (or deemed to be received)
by a Dissenting Resident Holder that is a corporation as proceeds of disposition or a capital gain.
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A Dissenting
Resident Holder that is a “private corporation” or “subject corporation”, each as defined in the Tax Act, may
be liable to pay a refundable tax under Part IV of the Tax Act on dividends deemed to be received on its SilverCrest Shares, to the extent
such dividends are deductible in computing the Dissenting Resident Holder’s taxable income for the taxation year. A “subject
corporation” is generally a corporation (other than a private corporation) resident in Canada and controlled directly or indirectly
by or for the benefit of an individual (other than a trust) or a related group of individuals (other than trusts). Dissenting Resident
Holders that are corporations should consult their own tax advisors having regard to their own circumstances.
Alternatively,
since the payment to a Dissenting Resident Holder is not made until after the Amalgamation, a Dissenting Resident Holder who is paid
the fair value of such Dissenting Resident Holder’s SilverCrest Shares by Amalco may realize a capital gain (or a capital loss)
equal to the amount, if any, by which the cash received in respect of the fair value of such Dissenting Resident Holder’s SilverCrest
Shares (other than in respect of any interest awarded by the court) exceeds (or is less than) the aggregate of the adjusted cost base
of such SilverCrest Shares to the Dissenting Resident Holder and any reasonable costs of disposition. . Any capital gain or capital loss
realized by a Dissenting Resident Holder, will be treated in the same manner as described under the heading “Holders Resident
in Canada — Taxation of Capital Gains and Capital Losses” above.
A Dissenting
Resident Holder will be required to include the amount of any interest awarded to the Dissenting Resident Holder by a court in income.
In addition, a Dissenting Resident Holder that, throughout the relevant taxation year, is a CCPC or “substantive CCPC” may
be liable to pay a refundable tax on its “aggregate investment income” (as defined in the Tax Act), including interest income,
as described above under “Holders Resident in Canada — Additional Refundable Tax”.
Resident Holders
who are considering exercising Dissent Rights are urged to consult their tax advisors with respect to the Canadian federal income tax
consequences of exercising their Dissent Rights.
Holders
Not Resident in Canada
The following
portion of the summary is generally applicable to a Holder who, at all relevant times, for purposes of the Tax Act and any applicable
income tax treaty, is neither resident nor deemed to be resident in Canada, and does not use or hold, and is not deemed to use or hold,
SilverCrest Shares or Coeur Shares in connection with carrying on a business in Canada (a “Non-Resident Holder”).
This part of the summary is not applicable to Non-Resident Holders that are insurers carrying on an insurance business in Canada and
elsewhere or an “authorized foreign bank” (as defined in the Tax Act). Such Non-Resident Holders should consult their own
tax advisors.
Disposition
of SilverCrest Shares Pursuant to the Arrangement and subsequent dispositions of Coeur Shares
A Non-Resident
Holder will not be subject to tax under the Tax Act on any capital gain realized on the disposition of SilverCrest Shares under the Arrangement
or on the future or deemed disposition of Coeur Shares, unless the SilverCrest Shares or Coeur Shares, as applicable, are “taxable
Canadian property” and are not “treaty-protected property”, each as defined in the Tax Act, to the Non-Resident Holder.
Generally, a
SilverCrest Share or a Coeur Share, as the case may be, will not be taxable Canadian property of a Non-Resident Holder at a particular
time provided that the share is listed on a “designated stock exchange” (which currently includes the NYSE and the TSX) unless,
at any time during the 60-month period immediately preceding the disposition: (a) the Non-Resident Holder, any one or more other Persons
with whom the Non-Resident Holder does not deal at arm’s length, any partnership in which the Non-Resident Holder or a non-arm’s
length Person holds a membership interest directly or indirectly through one or more partnerships, or the Non-Resident Holder together
with such Persons or partnerships, held 25% or more of the issued shares of any class or series in the capital of SilverCrest or Coeur,
as the case may be; and (b) more than 50% of the fair market value of the share was derived directly or indirectly from one or any combination
of real or immovable property situated in Canada, “Canadian resource property” or “timber resource property”,
(both as defined in the Tax Act), and options in respect of, or interests in, or for civil law rights in, any such properties (whether
or not such property exists).
Notwithstanding
the foregoing, in certain other circumstances a SilverCrest Share or Coeur Share could be deemed to be taxable Canadian property for
the purposes of the Tax Act. Non-Resident Holders should consult their own tax advisors in this regard.
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Even if the SilverCrest
Shares or Coeur Shares, as the case may be, are taxable Canadian property to a Non-Resident Holder, a taxable capital gain resulting
from the disposition of the SilverCrest Shares or Coeur Shares will not be included in computing the Non-Resident Holder’s taxable
income earned in Canada for the purposes of the Tax Act if, at the time of the disposition, the SilverCrest Shares or Coeur Shares, as
the case may be, constitute treaty-protected property of the Non-Resident Holder for purposes of the Tax Act.
SilverCrest Shares
or Coeur Shares, as the case may be, will generally be considered treaty-protected property of a Non-Resident Holder for purposes of
the Tax Act at the time of the disposition if the gain from their disposition would, because of an applicable income tax treaty between
Canada and the country in which the Non-Resident Holder is resident for purposes of such treaty and in respect of which the Non-Resident
Holder is entitled to receive benefits thereunder, be exempt from tax under the Tax Act.
In the event
that the SilverCrest Shares constitute taxable Canadian property and are not treaty-protected property to a particular Non-Resident Holder,
the Non-Resident Holder will realize a capital gain (or capital loss) generally in the circumstances as described under “Holders
Resident in Canada – Disposition of SilverCrest Shares Pursuant to the Arrangement” and “Holders Resident in
Canada – Taxation of Capital Gains and Capital Losses”.
Similarly, Non-Resident
Holders whose Coeur Share Shares constitute taxable Canadian property and are not treaty-protected property as defined in the Tax Act
at the time of disposition will generally be subject to the tax considerations described above under “Holders Resident in Canada
– Dispositions of Coeur Shares” and “Holders Resident in Canada – Taxation of Capital Gains and Capital
Losses”.
A Non-Resident
Holder who disposes of taxable Canadian property that is not treaty-protected property may have to file a Canadian income tax return
for the year in which the disposition occurs, regardless of whether the Non-Resident Holder is liable for Canadian tax on any gain realized.
Non-Resident
Holders whose SilverCrest Shares or Coeur Shares, as the case may be, are taxable Canadian property should consult their own tax advisors
for advice having regard to their particular circumstances, including whether their SilverCrest Shares or Coeur Shares constitute treaty-protected
property.
Dividends
on Coeur Shares
Dividends paid
on Coeur Shares to a Non-Resident Holder will not be subject to Canadian withholding tax under the Tax Act.
Dissenting
Non-Resident Holders
A Non-Resident
Holder that validly exercises Dissent Rights under the Arrangement (a “Dissenting Non-Resident Holder”) will be deemed
to have transferred their SilverCrest Shares to SilverCrest .
The tax consequences
to a Dissenting Non-Resident Holder in respect of their deemed transfer of SilverCrest Shares are unclear. The obligation to pay fair
value to a Dissenting Non-Resident Holder is an obligation of SilverCrest, but the timing of the payment will not occur until after the
Amalgamation, at which time the payor will be Amalco.
Under one interpretation,
a Dissenting Non-Resident Holder who is paid fair value of such Dissenting Non-Resident Holder’s SilverCrest Shares by Amalco may
be deemed to have received a taxable dividend equal to the amount, if any, by which the cash received in respect of the fair value of
such Dissenting Non-Resident Holder’s SilverCrest Shares (other than in respect of any interest awarded by the court) exceeds the
paid-up capital of such SilverCrest Shares to the Dissenting Non-Resident Holder as determined under the Tax Act. In such circumstances,
a Dissenting Non-Resident Holder will also realize a capital gain (or capital loss) to the extent that the proceeds of disposition, less
an amount in respect of interest, if any, awarded by a court and the amount of any deemed dividend and less any reasonable costs of disposition,
exceed (or are less than) the adjusted cost base of the Dissenting Non-Resident Holder’s SilverCrest Shares. Dividends deemed to
be paid or credited, on a Dissenting Non-Resident Holder’s SilverCrest Shares will generally be subject to Canadian withholding
tax at a rate of 25% on the gross amount of the dividend unless the rate is reduced under the provisions of an applicable income tax
treaty or convention between Canada and the country in which the Dissenting Non-Resident Holder is resident and to which the Dissenting
Non-Resident Holder is entitled to the full benefits thereof.
Alternatively,
since the payment to a Dissenting Non-Resident Holder is not made until after the Amalgamation, a Dissenting Non-Resident Holder who
is paid the fair value of such Dissenting Non-Resident Holder’s SilverCrest Shares by Amalco may realize a capital
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gain (or a capital
loss) equal to the amount, if any, by which the cash received in respect of the fair value of such Dissenting Non-Resident Holder’s
SilverCrest Shares (other than in respect of any interest awarded by the court) exceeds (or is less than) the aggregate of the adjusted
cost base of such SilverCrest Shares to the Dissenting Non-Resident Holder and any reasonable costs of disposition.
A Dissenting
Non-Resident Holder will generally not be subject to income tax under the Tax Act in respect of any capital gain realized on a disposition
of SilverCrest Shares pursuant to the exercise of their Dissent Rights unless such SilverCrest Shares are considered to be “taxable
Canadian property”, as discussed above under the heading “Holders not Resident in Canada – Disposition of
SilverCrest Shares Pursuant to the Arrangement and subsequent dispositions of Coeur Shares”, to such Dissenting Non-Resident
Holder that is not exempt from tax under the Tax Act pursuant to the terms of an applicable income tax convention between Canada and
the country in which the Dissenting Non-Resident Holder is resident. Dissenting Non-Resident Holders whose SilverCrest Shares may
constitute “taxable Canadian property” should consult their own tax advisors.
In light of the
uncertainty concerning the tax consequences to a Non-Resident Holder who exercises Dissent Rights under the Arrangement, Silvercrest
(and Amalco after the completion of the Arrangement) intends to withhold and remit the amount that Amalco reasonably believes it is required
to remit under the Tax Act to the Receiver General of Canada and such amount will not be delivered by Amalco to the Dissenting Non-Resident
Holder.
Interest (if
any) awarded by a court to a Dissenting Non-Resident Holder generally should not be subject to withholding tax under the Tax Act.
Non-Resident
Holders who are considering exercising Dissent Rights are urged to consult their tax advisors with respect to the Canadian federal income
tax consequences of exercising their Dissent Rights.
CERTAIN
UNITED STATES FEDERAL INCOME TAX CONSEQUENCES OF THE ARRANGEMENT
The following
is a general discussion of certain U.S. federal income tax considerations under the Code, generally applicable to certain U.S. Holders
(as defined below) relating to the Arrangement, the receipt of the Consideration pursuant to the Arrangement, and the ownership and disposition
of the Coeur Shares by such U.S. Holders following the Arrangement. This discussion is based upon the provisions of the Code, existing
final and temporary U.S. Treasury Regulations, the Canada-United States Tax Convention (1980), as amended, and current administrative
rulings and court decisions in effect on the date hereof, all of which are subject to change, possibly with retroactive effect, and to
differing interpretations. Changes in these authorities may cause the U.S. federal income tax consequences to vary substantially from
those described below.
This summary
does not discuss the potential effects, whether adverse or beneficial, of any proposed legislation that, if enacted, could be applied
on a retroactive or prospective basis. This summary does not address the U.S. federal alternative minimum, U.S. federal estate and gift,
U.S. state or local, U.S. federal net investment income or non-U.S. tax consequences to U.S. Holders of the Arrangement or the ownership
and disposition of Coeur Shares received pursuant to the Arrangement. This summary does not discuss the U.S. tax consequences of the
Arrangement to holders with respect to their SilverCrest DSUs, SilverCrest RSUs or SilverCrest PSUs. In addition, except as specifically
set forth below, this summary does not discuss applicable tax reporting requirements.
No legal opinion
from U.S. legal counsel or ruling from the IRS has been requested, or is expected to be obtained, regarding the U.S. federal income tax
consequences described herein. This discussion is not binding on the IRS or any court, and there can be no assurance that the IRS will
not take a contrary position or that such a position would not be sustained by a court. This discussion also assumes that the Arrangement
is carried out as described in this Circular and that the Arrangement is not integrated with any other transaction for U.S. federal income
tax purposes.
This discussion
is for general information only and is not intended to be, nor should it be construed to be, legal or tax advice to any holder of SilverCrest
Shares (or, after the Arrangement, Coeur Shares) and no opinion or representation with respect to the U.S. federal income tax consequences
to any such holder is made. This summary does not take into account the individual facts and circumstances of any particular U.S. Holder
that may affect the U.S. federal income tax consequences to such U.S. Holder, including specific tax consequences to a U.S. Holder under
an applicable tax treaty. This discussion applies only to U.S. Holders that own SilverCrest Shares and will own Coeur Shares as “capital
assets” within the meaning of Section 1221 of the Code (generally, property held for investment), and does not discuss all of the
U.S. federal income tax considerations that may be relevant to specific U.S. Holders in light of their particular circumstances or to
U.S. Holders subject to special treatment under U.S. federal income tax law, including without limitation:
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| · | banks,
trusts, mutual funds and other financial institutions; |
| | | |
| · | regulated
investment companies or real estate investment trusts; |
| | | |
| · | traders
in securities that elect to apply a mark-to-market method of accounting; |
| | | |
| · | brokers,
dealers or traders in securities, currencies or commodities; |
| | | |
| · | tax-exempt
organizations, tax-qualified retirement accounts, or pension funds; |
| | | |
| · | insurance
companies; |
| | | |
| · | dealers
or brokers in securities or foreign currency; |
| · | individual
retirement and other tax-deferred accounts; |
| | | |
| · | U.S.
Holders whose functional currency is not the U.S. dollar; |
| | | |
| · | U.S.
expatriates or former long-term residents of the United States.; |
| | | |
| · | persons
subject to taxing jurisdictions other than, or in addition to, the United States ; |
| | | |
| · | persons
subject to special tax accounting rules; |
| | | |
| · | U.S.
Holders that own, directly, indirectly or constructively, five percent (5%) or more of the
total voting power or total value of all of the outstanding stock of SilverCrest or Coeur,
as applicable; |
| | | |
| · | persons
liable for the alternative minimum tax; |
| | | |
| · | holders
that hold their shares as part of a straddle, hedging, conversion, constructive sale or other
risk reduction transaction; |
| | | |
| · | holders
other than U.S. Holders; |
| | | |
| · | partnerships
or other pass-through entities (and partners or other owners thereof); |
| | | |
| · | S
corporations (and shareholders thereof); and |
| | | |
| · | holders,
such as holders of SilverCrest DSUs, SilverCrest PSUs and SilverCrest RSUs, who received
their shares through the exercise or cancellation of employee stock options or otherwise
as compensation for services or through a tax-qualified retirement plan. |
U.S. Holders
that are subject to special provisions under the Code, including U.S. Holders described immediately above, should consult their own tax
advisors regarding the U.S. federal, state and local, and non-U.S. tax consequences relating to the Arrangement, the receipt of the Consideration
pursuant to the Arrangement, and the ownership and disposition of the Coeur Shares by such U.S. Holders following the Arrangement.
U.S. Holders
are urged to also review the separate discussion concerning Canadian federal income tax consequences. See “Certain Canadian
Federal Income Tax Considerations”.
For purposes
of this discussion, a “U.S. Holder” means a beneficial owner of SilverCrest Shares at the time of the Arrangement
and, to the extent applicable, Coeur Shares following the Arrangement, that is:
| · | an
individual who is a citizen or resident of the United States, as determined for U.S. federal
income tax purposes; |
| | | |
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| · | a
corporation (or other entity taxable as a corporation for U.S. federal income tax purposes)
created or organized in the United States or under the laws of the United States or any state
thereof or the District of Columbia; |
| | | |
| · | an
estate the income of which is includible in gross income for U.S. federal income tax purposes
regardless of its source; or |
| | | |
| · | a
trust if (1) a court within the United States is able to exercise primary supervision over
the administration of the trust and one or more U.S. persons have the authority to control
all substantial decisions of the trust, or (2) the trust has a valid election in effect under
applicable U.S. Treasury Regulations to be treated as a U.S. person for U.S. federal income
tax purposes. |
If a
partnership, including for this purpose any entity or arrangement that is treated as a partnership or other
“pass-through” entity for U.S. federal income tax purposes, holds SilverCrest Shares at the time of the Arrangement or,
to the extent applicable, Coeur Shares following the Arrangement, the tax treatment of a partner in such partnership will generally
depend upon the status of the partner and the activities of the partnership. A shareholder that is a partnership and a
partner (or other owner) in such partnership is urged to consult its own tax advisors about the U.S. federal income tax consequences
of the Arrangement.
THIS SUMMARY
IS FOR GENERAL INFORMATION ONLY AND IS NOT INTENDED TO CONSTITUTE A COMPLETE DESCRIPTION OF ALL UNITED STATES TAX CONSEQUENCES RELATING
TO THE ARRANGEMENT AND HOLDING AND DISPOSING OF COEUR SHARES RECEIVED PURSUANT TO THE ARRANGEMENT. SHAREHOLDERS ARE URGED TO CONSULT
THEIR OWN TAX ADVISORS AS TO THE U.S. FEDERAL INCOME AND OTHER TAX CONSIDERATIONS RELATING TO THE ARRANGEMENT IN LIGHT OF THEIR PARTICULAR
CIRCUMSTANCES, AS WELL AS THE EFFECT OF ANY STATE, LOCAL OR NON-U.S. TAX LAWS.
U.S.
Federal Income Tax Consequences of the Arrangement and the Receipt of the Consideration Pursuant to the Arrangement
It is intended
that, for U.S. federal income tax purposes, the Arrangement will qualify as a “reorganization” within the meaning of Section
368(a) of the Code, provided that provided that Dissenting Shareholders, if any, are paid by SilverCrest for their SilverCrest Shares
with SilverCrest funds which are not directly or indirectly provided by Coeur or any affiliate of Coeur. However, no opinion of counsel
has been obtained, and neither Coeur nor SilverCrest intends to seek a ruling from the IRS regarding the characterisation of the Arrangement
for U.S. federal income tax purposes. Therefore, there can be no assurance that the IRS will not disagree with or challenge the intended
characterisation of the Arrangement for U.S. federal income tax purposes. The remainder of this discussion assumes that the Arrangement
qualifies as a transaction described in Section 368(a) of the Code. U.S. Holders should consult their tax advisers regarding the characterisation
of the Arrangement for U.S. federal income tax purposes.
Subject to the
passive foreign investment company (“PFIC”) rules discussed below, a U.S. Holder of SilverCrest Shares immediately
prior to the Arrangement that does not exercise Dissent Rights should not recognise any gain or loss for U.S. federal income tax purposes
as a result of the transactions contemplated pursuant to the Arrangement and should have the same holding period and adjusted tax basis
with respect to their Coeur Shares after the Arrangement as such U.S. Holder had with respect to their SilverCrest Shares immediately
prior to the Arrangement. If a U.S. Holder holds different blocks of SilverCrest Shares (generally as a result of having acquired different
blocks of shares at different times or at different costs), such U.S. Holder's tax basis and holding period in its Coeur Shares may be
determined with reference to each block of the SilverCrest Shares surrendered in exchange therefor. The treatment of a U.S. Holder of
SilverCrest Shares that exercises Dissent Rights is discussed below under “Payments Related to Dissent Rights”.
Passive
Foreign Investment Company Considerations
In General
A foreign corporation
is a PFIC for U.S. federal income tax purposes if either (A) at least 75% of its gross income in a taxable year, including its pro rata
share of the gross income of any corporation in which it is considered to own at least 25% of the shares by value, is passive income,
or (B) at least 50% of its assets in a taxable year, ordinarily determined based on fair market value and averaged quarterly over the
year, including its pro rata share of the assets of any corporation in which it is considered to own at least 25% of the shares by value,
are held for the production of or produce passive income. Passive income generally includes dividends, interest, rents and royalties,
and gains from the disposition of passive assets.
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SilverCrest believes
that (a) it was not classified as a PFIC for its 2022 tax year nor its 2023 tax year and (b) it is possible that it will not be a PFIC
for its current 2024 tax year. No opinion of legal counsel or ruling from the IRS concerning the status of SilverCrest as a PFIC has
been obtained or is currently planned to be requested. The determination of whether any corporation was, is or will be, a PFIC for a
tax year depends, in part, on the application of complex U.S. federal income tax rules, which are subject to differing interpretations.
In addition, whether any corporation will be a PFIC for any tax year depends on the assets and income of such corporation over the entire
course of each such tax year and, as a result, often cannot be predicted with certainty for the current tax year or for any future tax
year as of the date of this Circular. There cannot be any assurance that the IRS will not challenge any determination either corporation
might make concerning its PFIC status. If a corporation is a PFIC for any year during which a U.S. Holder holds its shares, such holder
will be subject to the rules described below under “Consequences of PFIC Status”.
Each U.S. Holder
should consult its own tax advisors regarding PFIC status.
Consequences
of PFIC Status
Even if the Arrangement
qualifies as a reorganization with the meaning of Section 368(a) of the Code, Section 1291(f) of the Code provides that, to the extent
provided in U.S. Treasury Regulations, a U.S. Holder that disposes of PFIC stock must recognize gain notwithstanding any other provisions
of the Code. Under proposed U.S. Treasury Regulations, unless a U.S. Holder has made a “qualified electing fund” under Section
1295 of the Code (a “QEF Election”), a QEF Election along with a purging election, or a “Mark-to-Market Election”
under Section 1296 of the Code, or the Arrangement qualifies for the transfer to a U.S. person exception under Proposed U.S. Treasury
Regulations Section 1.1291-6(c) (each discussed below), if SilverCrest is classified as a PFIC for any tax year during which a U.S. Holder
has held SilverCrest Shares:
| (a) | the
Arrangement would be treated as a taxable exchange in which gain (but not loss) would be
recognized by a U.S. Holder even if such transaction qualifies as a reorganization within
the meaning of Section 368(a) of the Code; |
| (b) | any
gain on the exchange of SilverCrest Shares would be allocated ratably over such U.S. Holder's
holding period; |
| (c) | the
amount allocated to the current tax year and any year prior to the first year in which SilverCrest
was classified as a PFIC would be taxed as ordinary income in the current year; |
| (d) | the
amount allocated to each of the other tax years would be subject to tax at the highest rate
of tax in effect for the applicable class of taxpayer for that year; and |
| (e) | an
interest charge for a deemed deferral benefit would be imposed with respect to the resulting
tax attributable to each of the other tax years referred to in (d) above, which interest
charge would generally not be deductible by non-corporate U.S. Holders. |
As indicated
above, there are certain U.S. federal income tax elections that sometimes can be made to generally mitigate or avoid these PFIC tax consequences
if SilverCrest were to be classified as a PFIC for any tax year during which a U.S. Holder has held SilverCrest Shares. The impact of
the PFIC rules on a U.S. Holder of SilverCrest Shares will depend in part on whether the U.S. Holder has made a timely and effective
election to treat SilverCrest as a QEF, under Section 1295 of the Code, for SilverCrest’s first taxable year as a PFIC in which
the U.S. Holder held (or was deemed to hold) SilverCrest Shares, the U.S. Holder made a QEF Election along with a “purging election”,
or if the U.S. Holder made a Mark-to-Market Election, all as described below. A U.S. Holder of a PFIC that made either a timely and effective
QEF Election, a QEF election along with a purging election, or a Mark-to-Market Election is hereinafter referred to as an “Electing
Shareholder”. The proposed Treasury Regulations under Section 1291(f) would not apply to an Electing Shareholder.
A U.S. Holder’s
ability to make a QEF Election with respect to its SilverCrest Shares is contingent upon, among other things, the provision by SilverCrest
of certain information that would enable the U.S. Holder to make and maintain a QEF Election. SilverCrest has historically provided,
and will endeavor to continue to provide, to a U.S. Holder such information as the IRS may require, including a PFIC annual information
statement, in order to enable the U.S. Holder to make and maintain a QEF Election, but there can be no assurance that SilverCrest will
continue to timely provide such information that is required to make and maintain the QEF Election.
As indicated
above, if a U.S. Holder of SilverCrest Shares has not made a timely and effective QEF Election with respect to SilverCrest’s first
taxable year as a PFIC in which the U.S. Holder held (or was deemed to hold) SilverCrest Shares, such U.S. Holder generally may
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nonetheless
qualify as an Electing Shareholder by filing on a timely filed U.S. income tax return (including extensions) a QEF Election and a purging
election to recognize under the rules of Section 1291 of the Code any gain that it would otherwise recognize if the U.S. Holder sold
its SilverCrest Shares for their fair market value on the “qualification date”. The qualification date is the first day of
SilverCrest’s tax year in which SilverCrest qualifies as a QEF with respect to such U.S. Holder. The purging election can only
be made if such U.S. Holder held SilverCrest Shares on the qualification date. The gain recognized by the purging election will be subject
to the special tax and interest charge rules treating the gain as an excess distribution, as described above. As a result of the purging
election, the U.S. Holder will increase the adjusted tax basis in its SilverCrest Shares by the amount of the gain recognized and will
also have a new holding period in the SilverCrest Shares for purposes of the PFIC rules.
Alternatively,
if a U.S. Holder, at the close of its taxable year, owns shares in a PFIC that are treated as marketable shares, the U.S. Holder may
make a Mark-to-Market Election with respect to such shares for such taxable year. If the U.S. Holder makes a valid Mark-to-Market Election
for the first taxable year of the U.S. Holder in which the U.S. Holder holds (or is deemed to hold) SilverCrest Shares and for which
SilverCrest is determined to be a PFIC, such holder will not be subject to the PFIC rules described above in respect to its SilverCrest
Shares. Instead, the U.S. Holder will include as ordinary income each year the excess, if any, of the fair market value of its SilverCrest
Shares at the end of its taxable year over the adjusted basis in its SilverCrest Shares. The U.S. Holder also will be allowed to take
an ordinary loss in respect of the excess, if any, of the adjusted basis of its SilverCrest Shares over the fair market value of its
SilverCrest Shares at the end of its taxable year (but only to the extent of the net amount of previously included income as a result
of the Mark-to-Market Election). The U.S. Holder’s basis in its SilverCrest Shares will be adjusted to reflect any such income
or loss amounts and any further gain recognized on a sale or other taxable disposition of the SilverCrest Shares will be treated as ordinary
income. The Mark-to-Market Election is available only for shares that are regularly traded on a national securities exchange that is
registered with the Securities and Exchange Commission, including Nasdaq, or on a foreign exchange or market that the IRS determines
has rules sufficient to ensure that the market price represents a legitimate and sound fair market value. U.S. Holders should consult
their own tax advisers regarding the availability and tax consequences of a Mark-to-Market Election in respect to SilverCrest Shares
under their particular circumstances.
Notwithstanding
the foregoing, under Proposed U.S. Treasury Regulations Section 1.1291-6(c), a U.S. Holder that did not elect to treat a PFIC as a QEF
or make a Mark-to-Market Election nonetheless does not recognize gain on a direct or indirect disposition of stock of a PFIC that results
from a reorganization under Section 368 of the Code if immediately after the reorganization such stock is owned or considered owned by
a U.S. person (U.S. transferee), provided that:
| (a) | The
basis of the stock in the hands of its actual owner immediately after the reorganization
is no greater than the basis of such stock in the hands of its actual owner immediately before
the reorganization; |
| (b) | The
U.S. transferee's holding period for the transferred stock is at least as long as the holding
period of the shareholder immediately before the transfer; and |
| (c) | The
aggregate ownership of the U.S. Holder and the U.S. transferee immediately after the reorganization
(determined without regard to stock held by the U.S. transferee prior to the reorganization)
is the same as or greater than the U.S. Holder’s proportionate ownership immediately
before the reorganization. |
SilverCrest and
Coeur expect that the Arrangement will satisfy the requirements of the transfer to a U.S. person exception under Proposed U.S. Treasury
Regulations Section 1.1291-6(c), but can provide no assurance in this regard. No opinion of legal counsel or ruling from the IRS concerning
this exception has been obtained or is currently planned to be requested.
Moreover, the
proposed U.S. Treasury Regulations discussed above were proposed in 1992 and have not been adopted in final form. The proposed U.S. Treasury
Regulations state that they are to be effective for transactions occurring on or after April 1, 1992. However, because the proposed U.S.
Treasury Regulations have not yet been adopted in final form, they are not currently effective and there is no assurance they will be
finally adopted in the form and with the effective date proposed. Nevertheless, the IRS has announced that, in the absence of final U.S.
Treasury Regulations, taxpayers may apply reasonable interpretations of the Code provisions applicable to PFICs and that it considers
the rules set forth in the proposed U.S. Treasury Regulations to be reasonable interpretations of those Code provisions.
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The rules for
PFICs, QEF elections, mark-to-market elections and other elections are complex and affected by various factors in addition to those described
above. U.S. Holders are urged to consult their own tax advisors regarding the application of the rules to their particular circumstances.
Payments
Related to Dissent Rights
For U.S.
federal income tax purposes, a U.S. Holder that receives a payment for its SilverCrest Shares pursuant to the exercise of Dissent
Rights will generally recognize gain or loss equal to the difference, if any, between (i) the cash received and (ii) such U.S.
Holder’s adjusted tax basis in the SilverCrest Shares surrendered in exchange therefor. Subject to the PFIC rules discussed
above, such recognized gain or loss would generally constitute capital gain or loss and would constitute long-term capital gain or
loss if the U.S. Holder’s holding period for the Dissent Shares exchanged is greater than one year as of the date of
the exchange. Certain non-corporate U.S. Holders are entitled to preferential tax rates with respect to net long-term capital gains.
The ability of a U.S. Holder to offset capital losses against ordinary income is limited. The deductibility of capital losses is
subject to limitations under the Code.
Specified
Foreign Financial Assets Reporting
Certain U.S.
Holders that hold “specified foreign financial assets” are generally required to attach to their annual returns a completed
IRS Form 8938, Statement of Specified Foreign Financial Assets, with respect to such assets (and can be subject to substantial penalties
for failure to file). The definition of specified foreign financial asset includes not only financial accounts maintained in foreign
financial institutions, but also, if held for investment and not held in an account maintained by a financial institution, securities
of non-U.S. issuers (subject to certain exceptions, including an exception for securities of non-U.S. issuers held in accounts maintained
by domestic financial institutions). U.S. Holders are urged to consult their own tax advisors regarding the possible reporting requirements
with respect to their investments in SilverCrest Shares and the penalties for non-compliance.
U.S.
Federal Income Tax Consequences of the Ownership and Disposition of Coeur Shares
A U.S. Holder’s
initial tax basis in the Coeur Shares received pursuant to the Arrangement will be equal to the fair market value of such shares (determined
as of the Effective Date), and the U.S. Holder’s holding period in the Coeur Shares received should begin on the day after the
Effective Date.
Distributions
with Respect to Coeur Shares
A U.S. Holder
that receives a distribution, including a constructive distribution, with respect to a Coeur Share will be required to include the amount
of such distribution in gross income as a dividend (without reduction for any non-U.S. income tax withheld from such distribution) to
the extent of the current or accumulated “earnings and profits” of Coeur, as computed for U.S. federal income tax purposes.
To the extent that a distribution exceeds the current and accumulated “earnings and profits” of Coeur, such distribution
will be treated first as a tax-free return of capital to the extent of a U.S. Holder’s tax basis in the Coeur Shares and thereafter
as gain from the sale or exchange of such Coeur Shares (see “Sale or Other Taxable Disposition of Coeur Shares” below).
Dividends received on Coeur Shares by corporate U.S. Holders generally will be eligible for the “dividends received deduction”
subject to various conditions and limitations, including holding period requirements. Dividends paid by Coeur to non-corporate U.S. Holders,
including individuals, generally will be eligible for the preferential tax rates applicable to long-term capital gains for dividends,
provided certain holding period and other conditions are satisfied. The dividend rules are complex, and each U.S. Holder is urged to
consult its own tax advisor regarding the application of such rules.
Sale
or Other Taxable Disposition of Coeur Shares
A U.S. Holder
will generally recognize gain or loss on the sale or other taxable disposition of Coeur Shares in an amount equal to the difference,
if any, between (a) the amount of cash plus the fair market value of any property received and (b) such U.S. Holder’s adjusted
tax basis in such Coeur Shares surrendered in the sale or other disposition. Any such gain or loss generally will be capital gain or
loss, which will be long-term capital gain or loss if, at the time of the sale or other disposition, such Coeur Shares are held for more
than one year. Certain non-corporate U.S. Holders are entitled to preferential tax rates with respect to net long-term capital gains.
Deductions for capital losses are subject to significant limitations under the Code.
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Backup
Withholding and Information Reporting
The proceeds
of a sale or deemed sale by a U.S. Holder of SilverCrest Shares or Coeur Shares, or distributions thereon, may be subject to information
reporting to the IRS and to U.S. backup withholding. Backup withholding will not apply, however, to a U.S. Holder that furnishes a correct
taxpayer identification number and makes other required certifications, or that is otherwise exempt from backup withholding and establishes
such exempt status.
Backup withholding
is not an additional tax. Amounts withheld may be credited against a U.S. Holder’s U.S. federal income tax liability, and a U.S.
Holder generally may obtain a refund of any excess amounts withheld under the backup withholding rules by timely filing an appropriate
claim for refund with the IRS and furnishing any required information.
THIS DISCUSSION
IS GENERAL IN NATURE AND DOES NOT DISCUSS ALL ASPECTS OF U.S. FEDERAL INCOME TAXATION THAT MAY BE RELEVANT TO A PARTICULAR SHAREHOLDER
IN LIGHT OF THE SHAREHOLDER’S PARTICULAR CIRCUMSTANCES, OR TO CERTAIN TYPES OF SHAREHOLDERS SUBJECT TO SPECIAL TREATMENT UNDER
U.S. FEDERAL INCOME TAX LAWS. YOU ARE URGED TO CONSULT WITH YOUR OWN TAX ADVISOR TO DETERMINE THE PARTICULAR TAX CONSEQUENCES TO YOU
OF THE ARRANGEMENT AND THE HOLDING AND DISPOSING OF COEUR SHARES RECEIVED PURSUANT TO THE ARRANGEMENT, INCLUDING THE APPLICABILITY AND
EFFECT OF STATE, LOCAL AND NON-U.S. TAX LAWS.
OTHER
INFORMATION
Interests of Informed
Persons in Material Transactions
Except as disclosed
under “The Arrangement – Interests of Certain Persons in the Arrangement” and “Information Concerning
SilverCrest” in this Circular, no informed person of the Company (e.g. directors and executive officers of the Company and
Persons beneficially owning or controlling or directing voting securities of the Company or a combination of both carrying more than
10% of the voting rights attached to all outstanding voting securities of the Company), or any associate or affiliate of any informed
person, has had any material interest in any transaction, or proposed transaction, which has materially affected or would materially
affect the Company or any of its subsidiaries since the commencement of the most recently completed financial year of the Company.
Material
Contracts
Except as otherwise
disclosed in this Circular and as discussed in the Company AIF, during the 12 months prior to the date of this Circular, SilverCrest
has not entered into any contracts, nor are there any contracts still in effect, that are material to SilverCrest or any of its Subsidiaries,
other than the contracts entered into in the ordinary course of business and the Arrangement Agreement. See “Material Contracts”
in the Company AIF, which is incorporated by reference in this Circular.
Auditors
PricewaterhouseCoopers
LLP is the auditor of the Company and has advised that it is independent of the Company within the meaning of the Chartered Professional
Accountants of British Columbia Code of Professional Conduct, and within the meaning of the U.S. Securities Act and the applicable rules
and regulations thereunder adopted by the SEC and the PCAOB.
Additional Information
Additional information
relating to the Company is available on SEDAR+ at www.sedarplus.ca, on EDGAR at www.sec.gov and on the Company’s website
at www.silvercrestmetals.com. Financial information is provided in the Company’s audited consolidated financial statements
and MD&A for its most recently completed financial year which are filed on SEDAR+. In addition, copies of the Company’s annual
financial statements and MD&A and this Circular may be obtained upon request to the Company at Suite 501, 570 Granville Street, Vancouver,
British Columbia V6C 3P1.
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APPROVAL
OF THE BOARD OF DIRECTORS
The contents and
the sending of the Notice of Meeting and this Circular have been approved by the Board.
DATED this 8th
day of January, 2025
BY ORDER OF THE
BOARD OF DIRECTORS
/s/ “N.
Eric Fier”
N. Eric Fier
Chief Executive Officer
and Director
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APPENDIX
A
ARRANGEMENT RESOLUTION
BE IT RESOLVED,
AS A SPECIAL RESOLUTION, THAT:
| (a) | The
arrangement (the “Arrangement”) under Section 288 of the Business Corporations
Act (British Columbia) (the “BCBCA”), involving Coeur Mining, Inc.
(“Coeur”), SilverCrest Metals Inc. (the “Company”),
1504648 B.C. Unlimited Liability Company (“Coeur Canadian Sub”), Coeur
Rochester, Inc. (“Coeur U.S. Sub”), Compañía Minera La Llamarada,
S.A. De C.V. (“Company Mexican Sub”), the holders of common shares and
stock options of the Company (the “Securityholders”), all as more particularly
described and set forth in the management information circular (the “Circular”)
of the Company dated January 8, 2025 accompanying the notice of the meeting (as the Arrangement
may be modified, supplemented or amended in accordance with its terms), is hereby authorized,
approved and adopted; |
| (b) | The
plan of arrangement, as it may be or has been amended (the “Plan of Arrangement”),
involving Coeur, Coeur Canadian Sub, the Company and the Securityholders and implementing
the Arrangement, the full text of which is set out in Appendix B to the Circular (as
the Plan of Arrangement may be, or may have been, modified, supplemented or amended in accordance
with its terms), is hereby authorized, approved and adopted; |
| (c) | The
arrangement agreement among Coeur, the Company, Coeur Canadian Sub, Coeur U.S. Sub and Company
Mexican Sub dated as of October 3, 2024, as the same may be amended, supplemented
or otherwise modified from time to time in accordance with its terms (the “Arrangement
Agreement”) and all the transactions contemplated therein, the actions of the directors
of the Company in approving the Arrangement and the actions of the officers of the Company
in executing and delivering the Arrangement Agreement and any modifications, supplements
or amendments thereto in accordance with its terms are hereby confirmed, ratified and approved
in all respects; |
| (d) | The
Company is hereby authorized to apply for a final order from the Supreme Court of British
Columbia (the “Court”) to approve the Arrangement in accordance with and
subject to the terms set forth in the Arrangement Agreement and the Plan of Arrangement (as
they may be, or may have been, modified, supplemented or amended from time to time in accordance
with their terms); |
| (e) | Notwithstanding
that this resolution has been passed (and the Plan of Arrangement adopted) by the Securityholders
or that the Arrangement has been approved by the Court, the directors of the Company are
hereby authorized and empowered, at their discretion, without further notice to, or approval
of, the shareholders of the Company: |
| (i) | to
modify, supplement or amend the Arrangement Agreement or the Plan of Arrangement to the extent
permitted by the Arrangement Agreement or the Plan of Arrangement; or |
| (ii) | subject
to the terms of the Arrangement Agreement, not to proceed with the Arrangement; |
| (f) | Any
one or more directors or officers of the Company is hereby authorized, for and on behalf
and in the name of the Company, to execute and deliver, whether under corporate seal of the
Company or not, all such agreements, forms waivers, notices, certificate, confirmations and
other documents and instruments and to do or cause to be done all such other acts and things
as in the opinion of such director or officer may be necessary, desirable or useful for the
purpose of giving effect to these resolutions, the Arrangement Agreement and the completion
of the Plan of Arrangement in accordance with the terms of the Arrangement Agreement, including: |
| (i) | all
actions required to be taken by or on behalf of the Company, and all necessary filings and
obtaining the necessary approvals, consents and acceptances of appropriate regulatory authorities;
and |
| (ii) | the
signing of the certificates, consents and other documents or declarations required under
the Arrangement Agreement or otherwise to be entered into by the Company; |
such determination
to be conclusively evidenced by the execution and delivery of such document, agreement or instrument or the doing of any such act or
thing.
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APPENDIX
B
PLAN OF ARRANGEMENT
PLAN OF ARRANGEMENT
UNDER SECTION 288 OF THE
BUSINESS CORPORATIONS ACT (BRITISH COLUMBIA)
ARTICLE 1
DEFINITIONS AND INTERPRETATION
1.1 Definitions
In this Plan
of Arrangement, unless the context otherwise requires:
“Amalco”
has the meaning given to it in Section 2.3(k);
“Amalco
Shares” means the common shares in the authorized share structure of Amalco;
“Amalco
Directors” means Mitchell J. Krebs, Thomas S. Whelan and Anne Beckelheimer;
“Amalco
Officers” means Mitchell J. Krebs as President, Michael Routledge as Vice President, Casey M. Nault as Corporate Secretary,
Emilie Schouten as Vice President, Kenneth J. Watkinson as Vice President, Anne Beckelheimer as Treasurer, Kyle J. Swanson as Assistant
Secretary and Brad Vujtech as Assistant Treasurer;
“Amalgamation”
has the meaning given to it in Section 2.3(k);
“Applicable
Federal Rate” means the interest rate provided for under Section 1274(d) of the U.S. Tax Code;
“Arrangement”
means the arrangement of Company under Part 9, Division 5 of the BCBCA on the terms and subject to the conditions set out in this Plan
of Arrangement, subject to any amendments or variations thereto made in accordance with the terms of the Arrangement Agreement, this
Plan of Arrangement, or made at the direction of the Court in the Final Order (with the prior written consent of both Company and Parent,
each acting reasonably);
“Arrangement
Agreement” means the arrangement agreement dated October 3, 2024 among Parent, Parent Canadian Sub, Parent U.S. Sub, Company
Mexican Sub and Company to which this Plan of Arrangement is attached as Schedule A, including all schedules annexed thereto, together
with the Company Disclosure Letter and the Parent Disclosure Letter, as the same may be amended, supplemented or otherwise modified from
time to time in accordance with the terms thereof;
“Arrangement
Resolution” means the special resolution of the Company Securityholders approving the Plan of Arrangement, which is to be considered
and, if thought fit, passed at the Company Meeting, substantially in the form and content of Schedule B to the Arrangement Agreement;
“Authorization”
means, with respect to any Person, any authorization, order, permit, approval, grant, agreement, licence, classification, restriction,
registration, consent, order, right, notification, condition, franchise, privilege, certificate, judgment, writ, injunction, award, determination,
direction or decision having the force of Law, of, from or required by any Governmental Entity having jurisdiction over such Person;
“BCBCA”
means the Business Corporations Act (British Columbia) and the regulations made thereunder, as now in effect and as they may be promulgated
or amended from time to time;
“Bullion”
means all gold bullion and silver bullion, whether finished goods produced by or on behalf of Company and its affiliates or acquired
from third parties;
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“business
day” means any day, other than a Saturday, a Sunday or a statutory or civic holiday in New York, New York, Mexico City, Mexico,
or Vancouver, British Columbia;
“Company”
means SilverCrest Metals Inc., a corporation existing under the laws of the Province of British Columbia;
“Company
Canadian Sub” means NorCrest Metals Inc., a corporation existing under the laws of the Province of British Columbia, Canada,
that is a direct wholly owned subsidiary of the Company;
“Company
Canadian Sub Shares” means the common shares in the authorized share structure of Company Canadian Sub;
“Company
DSU Plan” means the deferred share unit plan of Company effective December 19, 2019;
“Company
DSUs” means the outstanding deferred share units granted under the Company DSU Plan and the Company Share Unit Plan;
“Company
Equity Incentive Plans” means, collectively, the Company Share Unit Plan, the Company Option Plans and the Company DSU Plan;
“Company
Incentive Awards” means, collectively, the Company DSUs, Company RSUs, Company Options and Company PSUs;
“Company
Loan” has the meaning given to it in Section 2.3(c);
“Company
Meeting” means the special meeting of Company Securityholders, including any adjournment or postponement thereof, to be called
and held in accordance with the Interim Order to consider the Arrangement Resolution and for any other purpose as may be set out in the
Company Circular and agreed to in writing by Parent;
“Company
Mexican Sub” means Compañía Minera La Llamarada, S.A. de C.V., a company existing under the laws of Mexico that
is an indirect wholly owned subsidiary of Company;
“Company
Optionholder” means a holder of Company Options;
“Company
Option Plans” means, collectively, the New Company Option Plan and the Legacy Company Option Plan;
“Company
Options” means the outstanding options to purchase Company Shares granted under the Company Option Plans;
“Company
PSUs” means the outstanding performance share units granted under the Company Share Unit Plan;
“Company
RSUs” means the outstanding restricted share units granted under the Company Share Unit Plan;
“Company
Securityholders” means the Company Shareholders and the Company Optionholders;
“Company
Shareholders” means the registered and/or beneficial holders of Company Shares, as the context requires;
“Company
Shares” means the common shares in the authorized share structure of Company;
“Company
Share Unit Plan” means the equity share unit plan of the Company effective June 3, 2021;
“Consideration”
means the consideration to be received by the Company Shareholders (other than Dissenting Shareholders) pursuant to this Plan of Arrangement
for their Company Shares, consisting of such number of Parent Shares equal to the Exchange Ratio for each Company Share;
“Consideration
Shares” means the Parent Shares to be issued to the Company Shareholders pursuant to this Plan of Arrangement;
“Court”
means the Supreme Court of British Columbia;
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“Depositary”
means Computershare Investor Services Inc., or such other Person as Parent and Company may appoint (acting reasonably) to act as depositary
in respect of the Arrangement;
“Dissent
Rights” has the meaning ascribed thereto in Section 4.1(a);
“Dissent
Shares” means the Company Shares held by a Dissenting Shareholder in respect of which the Dissenting Shareholder has validly
exercised Dissent Rights;
“Dissenting
Shareholder” means a registered Company Shareholder who has properly and validly dissented in respect of the Arrangement Resolution
in strict compliance with the Dissent Rights, who has not withdrawn or been deemed to have withdrawn such exercise of Dissent Rights
and who is ultimately determined to be entitled to be paid the fair value of its Company Shares, but only in respect of the Dissent Shares;
“DRS
Advice” has the meaning specified in Section 3.1;
“Effective
Date” means the date upon which the Arrangement becomes effective in accordance with Section 2.11(a) of the Arrangement Agreement;
“Effective
Time” means 9:00 a.m. on the Effective Date or such other time as Parent and Company agree to in writing before the Effective
Date;
“Exchange
Ratio” means 1.6022;
“Final
Order” means the final order of the Court made pursuant to Section 291 of the BCBCA, in a form and substance acceptable to
Company and Parent, each acting reasonably, approving the Arrangement, including as such order may be amended, supplemented, modified
or varied by the Court (with the consent of both Company and Parent, each acting reasonably) at any time prior to the Effective Date
or, if appealed, then, unless such appeal is withdrawn or denied, as affirmed or as amended (provided that any such amendment is acceptable
to both Company and Parent, each acting reasonably) on appeal;
“Governmental
Entity” means: (a) any international, federal, provincial, territorial, state, regional, municipal, local or other government,
governmental or public department, central bank, court, tribunal, arbitral body, international arbitration institution, commission, board,
ministry bureau, agency or entity, domestic or foreign; (b) any stock exchange, including the TSX, the NYSE and the NYSE American; (c)
any subdivision, agent, commission, board or authority of any of the foregoing; or (d) any quasi-governmental or private body or
self-regulatory organization exercising any regulatory, expropriation or taxing authority under or for the account of any of the foregoing;
“In-The-Money
Value” means, in respect of a stock option at a particular time, the amount, if any, by which (a) the aggregate fair market
value at that time of the stock subject to such option exceeds (b) the exercise price of such option;
“including”
means including without limitation, and “include” and “includes” have a corresponding meaning;
“Interim
Order” means the interim order of the Court made pursuant to Section 291 of the BCBCA, in a form and in substance acceptable
to Company and Parent, each acting reasonably, providing for, among other things, the calling and holding of the Company Meeting, including
as such order may be amended, supplemented, modified or varied by the Court (with the consent of Company and Parent, each acting reasonably);
“Law”
or “Laws” means all laws (including common law), by-laws, statutes, rules, regulations, principles of law and
equity, orders, rulings, ordinances, judgements, injunctions, determinations, awards, decrees or other requirements, whether
domestic or foreign, that are binding upon or applicable to such Person or its business, and the terms and conditions of any
Authorization of or from any Governmental Entity, and, for greater certainty, includes Securities Laws and applicable common law,
and the term “applicable” with respect to such Laws and in a context that refers to a Party, means such Laws as are
applicable to such Party and/or its Subsidiaries or their business, undertaking, property or securities and emanate from a
Person having jurisdiction over the Party and/or its Subsidiaries or its or their business, undertaking, property or securities;
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“Legacy
Company Option Plan” means the legacy stock option plan of Company effective August 24, 2015, as amended;
“Letter
of Transmittal” means the letter of transmittal to be delivered to registered Company Shareholders for use in connection with
the Arrangement;
“Liens”
means any hypothecs, mortgages, pledges, assignments, liens, charges, security interests, encumbrances and adverse rights or claims or
other third party interests or encumbrances of any kind, whether contingent or absolute, and any agreement, option, lease, sublease,
restriction, easement, right-of-way, right or privilege (whether by Law, contract or otherwise) capable of becoming any of the foregoing;
“New
Company Option Plan” means the stock option plan of Company effective June 15, 2022;
“Notice
of Dissent” means a written notice provided by a Company Shareholder that is a registered holder of Company Shares to Company
setting forth such Company Shareholder’s objection to the Arrangement Resolution and exercise of Dissent Rights;
“NYSE”
means the New York Stock Exchange;
“NYSE
American” means the NYSE American Stock Exchange;
“Parent”
means Coeur Mining, Inc., a corporation existing under the laws of the State of Delaware;
“Parent
Canadian Sub” means 1504648 B.C. Unlimited Liability Company, an unlimited liability corporation existing under the laws of
the Province of British Columbia, Canada, that is a direct or indirect wholly owned subsidiary of Parent;
“Parent
Canadian Sub Shares” means the common shares in the authorized share structure of Parent Canadian Sub;
“Parent
Replacement Options” means the options to acquire Parent Shares to be issued in exchange for Company Options pursuant to this
Plan of Arrangement;
“Parent
Shares” means the common stock in the capital of Parent;
“Parent
U.S. Sub” means Coeur Rochester, Inc.
“Parties”
means, together, Parent, Parent Canadian Sub, Parent U.S. Sub, Company, Company Canadian Sub, Company Mexican Sub and Amalco (upon and
following the Amalgamation), and “Party” means any one of them as the context requires;
“Person”
includes an individual, partnership, association, body corporate, trustee, executor, administrator, legal representative, government
(including any Governmental Entity) or any other entity, whether or not having legal status;
“Plan
of Arrangement” means this plan of arrangement and any amendments or variations hereto made in accordance with this plan of
arrangement or upon the direction of the Court in the Final Order with the consent of Company and Parent, each acting reasonably;
“Registrar”
means the Registrar of Companies for the Province of British Columbia duly appointed under Section 400 of the BCBCA;
“Specified
Cash Balance” means: (i) an amount to be specified by Parent no less than twenty-four (24) hours prior to the Effective
Time; or (ii) in case no amount is specified pursuant to clause (i) no less than twenty-four (24) hours prior to the Effective
Time, an amount that results in cash in value of no less than $25 million United States dollars as of the Effective Date remaining
with the Company Mexican Sub;
“Tax
Act” means the Income Tax Act (Canada) and the regulations made thereunder, as now in effect and as they may be promulgated
or amended from time to time;
“TSX”
means the Toronto Stock Exchange; and
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“U.S.
Securities Act” means the United States Securities Act of 1933, as amended and the rules and regulations promulgated thereunder.
1.2 Interpretation
Not Affected by Headings
The division
of this Plan of Arrangement into Articles and Sections and the insertion of headings are for convenience of reference only and shall
not affect in any way the meaning or interpretation of this Plan of Arrangement. Unless the contrary intention appears, references in
this Plan of Arrangement to an Article, Section or Step by number or letter or both refer to the Article, Section or Step, respectively,
bearing that designation in this Plan of Arrangement.
1.3 Number
and Gender
In this Plan
of Arrangement, unless the contrary intention appears, words importing the singular include the plural and vice versa, and words importing
gender include all genders.
1.4 Calculation
of Time
Unless otherwise
specified, time periods within or following which any payment is to be made or act is to be done shall be calculated by excluding the
day on which the period commences and including the day on which the period ends. Where the last day of any such time period is not a
business day, such time period shall be extended to the next business day following the day on which it would otherwise end.
1.5 Date
for Any Action
If the date on
which any action is required to be taken hereunder by a Party is not a business day, such action shall be required to be taken on the
next succeeding day which is a business day.
1.6 Currency
Unless otherwise
stated, all references in this Plan of Arrangement to sums of money are expressed in lawful money of Canada and “$” refers
to Canadian dollars.
1.7 No
Strict Construction
The language
used in this Plan of Arrangement is the language chosen by the Parties to express their mutual intent, and no rule of strict construction
shall be applied against any Party.
1.8 Statutory
References
A reference to
a statute includes all rules and regulations made pursuant to such statute and, unless otherwise specified, the provisions of any statute
or regulation or rule which amends, supplements or supersedes any such statute or any such regulation or rule.
1.9 Governing
Law
This Plan of
Arrangement shall be governed, including as to validity, interpretation and effect, by the laws of the Province of British Columbia and
the laws of Canada applicable therein.
1.10 Time
Time is of the
essence in the performance of the Parties’ respective obligations hereunder.
1.11 Time
References
In this Plan
of Arrangement, unless otherwise specified, any references to time are to local time, Vancouver, British Columbia.
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1.12 Other
Definitions
Capitalized terms
that are used herein but not defined shall have the meanings ascribed thereto in the Arrangement Agreement.
ARTICLE 2
THE ARRANGEMENT
2.1 Arrangement
Agreement
This Plan of
Arrangement is made pursuant to, and is subject to the provisions of, the Arrangement Agreement, except in respect of the sequence of
the steps comprising the Arrangement, which shall occur in the order set out in this Plan of Arrangement.
2.2 Effectiveness
This Plan of
Arrangement will become effective at the Effective Time (except as otherwise provided herein) and will be binding from and after the
Effective Time on Parent, Parent Canadian Sub, Parent U.S. Sub, Company, Company Canadian Sub, Company Mexican Sub, Amalco (upon and
following the Amalgamation), the Depositary, the Company Shareholders, including the Dissenting Shareholders, and the holders of Company
Options, in each case, without any further authorization, act or formality on the part of any Person, except as expressly provided herein.
2.3 The
Arrangement
The following
steps shall occur and shall be deemed to occur, commencing at the Effective Time, sequentially in the following order, with each such
step after the first occurring five minutes after the preceding step (except where otherwise indicated), and without any further authorization,
act or formality on the part of any Person:
Transfer
of Bullion and Payment of Intercompany Debt
| (a) | All
Bullion beneficially owned by the Company, in specie, in bullion accounts or otherwise, shall
be, and shall be deemed to be, transferred to Company Canadian Sub pursuant to Section 85
of the Tax Act and, in consideration therefor, Company Canadian Sub shall (i) allot and issue
one (1) Company Canadian Sub Share to Company, and (ii) issue a U.S. dollar denominated,
non-interest bearing, demand promissory note in favour of Company with a principal amount
equal to Company’s cost amount of the Bullion (for the purpose of the Tax Act), and
Company and Company Canadian Sub shall file a joint election under Section 85 of the Tax
Act and applicable provincial tax Laws with an elected amount determined by Company in its
sole discretion. |
| (b) | Company
Canadian Sub shall transfer, and shall be deemed to transfer, all Bullion referred to in
Step 2.3(a) to Parent U.S. Sub and, in consideration therefor, Parent U.S. Sub shall issue
and deliver to Company Canadian Sub a U.S. dollar denominated promissory note, with a principal
amount equal to the purchase price of the Bullion, being the fair market value thereof, bearing
interest at the short-term Applicable Federal Rate for U.S. tax purposes on the Effective
Date plus 2% per annum, having a maturity date that is December 31 of the year following the Effective Date. |
| |
(c) |
Company Mexican Sub shall
transfer a cash amount: |
| (i) | to
Company equal to the lesser of (A) the principal amount outstanding under the intercompany
indebtedness owing by Company Mexican Sub to Company (the “Company Loan”)
and (B) Company Mexican Sub’s Specified Cash Balance; |
| (ii) | if
Company Mexican Sub’s Specified Cash Balance less the repayment described in (i) is
positive, to Company equal to the lesser of (C) any accrued interest on the Company
Loan and (D) Company Mexican Sub’s Specified Cash Balance less the amount of the
repayment described in (i); and |
| (iii) | if
Company Mexican Sub’s Specified Cash Balance less the repayments described in (i) and
(ii) is positive, to Company Canadian Sub equal to the lesser of (E) the interest owing
on that certain intercompany loan between Company Mexican |
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| | | Sub
and Company Canadian Sub and (F) Company Mexican Sub’s Specified Cash Balance
less the amount of the repayments described in (i) and (ii); and |
following Step 2.3(c),
such amounts determined by this Step 2.3(c) shall be, and shall be deemed to be, repaid by Company Mexican Sub.
Dissenting
Shareholders
| (d) | Each
Dissent Share shall be and shall be deemed to be transferred and assigned by the holder thereof
without any further act or formality on its part, free and clear of all Liens, to Company
in accordance with, and for the consideration contemplated in, Section 4.1, and: |
| (i) | such
Dissenting Shareholder shall cease to be, and shall be deemed to cease to be, the registered
holder of each such Dissent Share and the name of such registered holder shall be, and shall
be deemed to be, removed from the central securities register of Company in respect of each
such Dissent Share, and at such time each Dissenting Shareholder will have only the rights
set out in Section 4.1; |
| (ii) | such
Dissenting Shareholder shall be deemed to have executed and delivered all consents, releases,
assignments and waivers, statutory or otherwise, required to transfer and assign each such
Dissent Share; and |
| (iii) | Company
shall be the holder of all of the outstanding Dissent Shares, free and clear of all Liens,
and the central securities register of Company shall be revised accordingly. |
Issuance
of Company Shares to Parent Canadian Sub
| (e) | Each
Company Shareholder, other than a Dissenting Shareholder, shall transfer and assign their
Company Shares, free and clear of any Liens, to Parent Canadian Sub in exchange for the Consideration
for each such Company Share so transferred, and in respect of the Company Shares so transferred: |
| (i) | the
registered holder thereof shall cease to be, and shall be deemed to cease to be, the registered
holder of each such Company Share and the name of such registered holder shall be removed
from the central securities register of Company; |
| (ii) | the
registered holder thereof shall be deemed to have executed and delivered all consents, releases,
assignments and waivers, statutory or otherwise, required to transfer and assign each such
Company Share; and |
| (iii) | Parent
Canadian Sub shall be the holder of all of the outstanding Company Shares, free and clear
of all Liens, and the central securities register of Company shall be revised accordingly. |
| (f) | Concurrently
with Section 2.3(e), in consideration for the Consideration issued and delivered to the Company
Shareholders by Parent on behalf and for the benefit of Parent Canadian Sub pursuant to Section
2.3(e), Parent Canadian Sub shall issue to Parent the number of Parent Canadian Sub Shares
having an aggregate fair market value and capital equal to the aggregate fair market value
of such Consideration issued to the Company Shareholders in Section 2.3(e). |
Treatment
of Company Options
| (g) | 30
minutes following Step 2.3(f), and notwithstanding any vesting or exercise or other
provisions to which a Company Option might otherwise be subject (whether by contract, the
conditions of grant, applicable Law or the terms of the applicable Company Option Plan governing
such Company Option), each Company Option outstanding immediately prior to the Effective
Time shall, without any further action by or on behalf of a holder, be exchanged for a Parent
Replacement Option exercisable to purchase from Parent the number of Parent Shares equal
to the product of (A) the number of Company Shares subject to the Company Option immediately
before the Effective Time multiplied by (B) the Exchange Ratio (provided that if the foregoing
would result in the issuance of a fraction of a Parent Share on any particular exercise of
Parent Replacement Options, then the number of Parent Shares otherwise issued shall be rounded
down to the nearest whole number of Parent |
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| | | Shares).
The exercise price per Parent Share subject to any such Parent Replacement Option shall be
an amount equal to the quotient of (X) the exercise price per Company Share underlying the
exchanged Company Option immediately prior to the Effective Time divided by (Y) the Exchange
Ratio (provided that the aggregate exercise price payable on any particular exercise of Parent
Replacement Options shall be rounded up to the nearest whole cent). It is intended that (i) the
provisions of Subsection 7(1.4) of the Tax Act apply to the aforesaid exchange of options
and (ii) such exchange of options be treated as other than the grant of a new stock right
or a change in the form of payment pursuant to Section 1.409A-1(b)(5)(v)(D) of the U.S. Treasury
Regulations. Accordingly, and notwithstanding the foregoing, if required, the exercise price
of a Parent Replacement Option will be adjusted such that the In-The-Money Value
of the Parent Replacement Option immediately after the exchange does not exceed the In-The-Money
Value of the Company Option for which it was exchanged immediately before the exchange. All
terms and conditions of a Parent Replacement Option, including the term to expiry, conditions
to and manner of exercising, will be the same as the Company Option for which it was exchanged,
and shall be governed by the terms of the applicable Company Option Plan and any document
evidencing a Company Option shall thereafter evidence and be deemed to evidence such Parent
Replacement Option, provided that the provisions of Section 7.1 of the New Company Option
Plan shall apply to all Parent Replacement Options that would otherwise be governed by the
Legacy Company Option Plan for a period of ninety (90) days following the Effective Time. |
Amalgamation
of Company and Company Canadian Sub
| (h) | At
9:00 a.m. on the day following the Effective Date, the notice of articles of Company shall
be altered to the extent necessary for Company to become an unlimited liability company as
contemplated pursuant to Section 51.31(1) of the BCBCA, such that (i) the statement required
under Section 51.11 of the BCBCA shall be included in the notice of articles of the Company;
(ii) the name of Company shall be changed to “SilverCrest Metals ULC” and Company
shall thereupon be an unlimited liability company under the BCBCA and, as soon as practicable
thereafter, Parent Canadian Sub, as sole shareholder of Company, shall return all share certificates
representing the Company Shares for inclusion on the face of each such certificate the statement
required pursuant to Section 51.2 of the BCBCA; and (iii) Parent Canadian Sub shall elect
to be classified as an association taxable as a corporation for U.S. federal income tax purposes
effective the day following the Effective Date. |
| (i) | 30
minutes following Step 2.3(h), the notice of articles of Company Canadian Sub shall be altered
to the extent necessary for Company Canadian Sub to become an unlimited liability company
as contemplated pursuant to Section 51.31(1) of the BCBCA, such that (i) the statement required
under Section 51.11 of the BCBCA shall be included in the notice of articles of Company;
and (ii) the name of Company shall be changed to “NorCrest Metals ULC” and Company
shall thereupon be an unlimited liability company under the BCBCA and, as soon as practicable
thereafter, Company, as sole shareholder of Company Canadian Sub, shall return all share
certificates representing the Company Canadian Sub Shares for inclusion on the face of each
such certificate the statement required pursuant to Section 51.2 of the BCBCA. |
| (j) | 30
minutes following Step 2.3(i), the capital of the Company Canadian Sub Shares shall be reduced
to $1. |
| (k) | 30
minutes following Step 2.3(j), Company and Company Canadian Sub shall amalgamate to
form one corporate entity, being a British Columbia unlimited liability company, with the
same effect as if they were amalgamated under Section 270 of the BCBCA (the “Amalgamation”),
except that the separate legal existence of Company Canadian Sub shall not cease (Company
Canadian Sub, as such surviving entity, “Amalco”) notwithstanding the
notation on the corporate register maintained by the Registrar or the issue of a Certificate
of Amalgamation evidencing the amalgamation of the Company and Company Canadian Sub to form
Amalco. Without limiting the foregoing, upon the occurrence of the Amalgamation, the separate
legal existence of Company will cease without Company being liquidated or wound-up, and Company
and Company Canadian Sub will continue as one company, and the property of Company (other
than Company Canadian Sub Shares and any amounts receivable between Company and Company Canadian
Sub, which are cancelled on the Amalgamation) will become the property of Amalco. For greater
certainty, the Parties intend that the Amalgamation will qualify as an amalgamation for purposes
of Subsection 87(11) of the Tax Act. On and after the Amalgamation, the following shall apply: |
| (i) | Name.
The name of Amalco shall be “NorCrest Metals ULC”; |
| (ii) | Registered
Office. The registered office of Amalco shall be the registered office of Company Canadian
Sub; |
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| (iii) | Business
and Powers. There shall be no restrictions on the business that Amalco may carry on or
on the powers it may exercise; |
| (iv) | Authorized
Share Capital. Amalco shall be authorized to issue an unlimited number of Amalco Shares; |
| (v) | Shares.
Each Company Share shall be exchanged into one fully paid and non-assessable Amalco Share,
and each Company Canadian Sub Share shall be cancelled without any repayment of capital.
No other securities will be issued and no assets will be distributed by Amalco in connection
with the Amalgamation; |
| (vi) | Restrictions
on Transfer. The restrictions on the issue, transfer or ownership of Company Shares shall
apply to Amalco Shares, mutatis mutandis; |
| (vii) | Initial
Directors. The initial directors of Amalco shall be the Amalco Directors; |
| (viii) | Initial
Officers. The initial officers of Amalco shall be the Amalco Officers; |
| (ix) | Capital.
The aggregate of the capital of the issued and outstanding Amalco Shares shall be equal to
the aggregate of the capital of the issued and outstanding Company Shares immediately before
the Amalgamation; |
| (x) | Effect
of Amalgamation. Upon the amalgamation of Company Canadian Sub and Company to form Amalco
becoming effective pursuant to Section 2.3(k): |
| (A) | Amalco
shall possess all the property, rights, privileges and interests (other than the Company
Canadian Sub Shares and any amounts receivable between Company and Company Canadian Sub,
which are cancelled on the Amalgamation) and be subject to all liabilities (other than amounts
receivable between Company and Company Canadian Sub, which are cancelled on the Amalgamation),
including civil, criminal and quasicriminal, and all contracts, disabilities and debts of
Company and Company Canadian Sub; |
| (B) | Amalco
is liable for all of the liabilities and obligations of Company and Company Canadian Sub
(other than amounts receivable between Company and Company Canadian Sub, which are cancelled
on the Amalgamation), and all rights of creditors or others have been, and will continue
to be, unimpaired by the Amalgamation, and all liabilities and obligations of Company and
Company Canadian Sub, whether arising by contract or otherwise, may be enforced against Amalco
to the same extent as if such obligations had been incurred or contracted by it; |
| (C) | any
existing cause of action, claim or liability to prosecution has not been and will not be
affected; |
| (D) | a
civil, criminal or administrative action or proceeding pending by or against either Company
or Company Canadian Sub may be continued by or against Amalco; |
| (E) | a
conviction against, or ruling, order or judgment in favor of or against Company or Company
Canadian Sub may be enforced by or against Amalco; and |
| (F) | Amalco
shall be deemed to be the party plaintiff or the party defendant, as the case may be, in
any civil action commenced by or against Company or Company Canadian Sub before the amalgamation
has become effective; |
| (xi) | Notice
of Articles. The notice of articles and articles of Amalco shall be substantially in
the form of the Company Canadian Sub notice of articles and articles, with the addition of
the statement required under Section 51.11 of the BCBCA; |
| (xii) | Articles.
The articles of Amalco shall be in the form of the Company Canadian Sub articles. |
The exchanges
and cancellations provided for in this Section 2.3 will be deemed to occur on the Effective Date or the day following the Effective Date,
as applicable, notwithstanding that certain procedures related thereto are not completed until after the Effective Date.
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ARTICLE 3
DELIVERY OF CONSIDERATION
3.1 Deposit
and Payment of Consideration
| | (a) | Following
receipt of the Final Order and no later than the business day prior to the Effective Date,
Parent shall deposit in escrow, or cause to be deposited in escrow, with the Depositary,
sufficient Parent Shares to satisfy the Consideration payable to the Company Shareholders
in accordance with Section 2.3, which shall be held by the Depositary in escrow as agent
and nominee for such former Company Shareholders for distribution to such former Company
Shareholders in accordance with the provisions of this Article 3. |
| | | |
| (b) | Upon
surrender to the Depositary for cancellation of a certificate or a direct registration statement
(DRS) advice (a “DRS Advice”) which immediately prior to the Effective
Time represented one or more Company Shares that were transferred under the Arrangement,
together with a duly completed and executed Letter of Transmittal and such other documents
and instruments as the Depositary or Parent may reasonably require, the holder of the Company
Shares represented by such surrendered certificate or DRS Advice shall be entitled to receive
in exchange therefor, and the Depositary shall deliver to such holder (in each case less
any amounts withheld pursuant to Section 3.7 (if any)), the Consideration that such
holder has the right to receive, and the certificate or DRS Advice so surrendered shall forthwith
be cancelled. |
| (c) | In
the event of a transfer of ownership of Company Shares which was not registered in the transfer
records of Company, the Consideration that such holder has the right to receive, subject
to Section 2.3, shall be delivered to the transferee if the certificate or DRS Advice
which immediately prior to the Effective Time represented Company Shares that were exchanged
for the Consideration under the Arrangement is presented to the Depositary, accompanied by
all documents reasonably required to evidence and effect such transfer. |
| | | |
| | (d) | After
the Effective Time and until surrendered for cancellation as contemplated by Section 3.1(b),
each certificate or DRS Advice that immediately prior to the Effective Time represented one
or more Company Shares, other than the Dissent Shares, shall be deemed at all times to represent
only the right to receive in exchange therefor the Consideration that the holder of such
certificate or DRS Advice is entitled to receive in accordance with Section 2.3, less
any amounts withheld pursuant to Section 3.7 (if any). |
3.2 Distributions
with Respect to Unsurrendered Certificates
No dividends
or other distributions declared or made after the Effective Time with respect to Consideration Shares with a record date after the Effective
Time shall be paid to the holder of any unsurrendered certificate which immediately prior to the Effective Time represented outstanding
Company Shares that were exchanged for Consideration Shares pursuant to Section 2.3(e) until the holder of such certificate shall
surrender such certificate in accordance with Section 3.1. Subject to applicable law, at the time of such surrender of any such
certificate (or, in the case of clause (ii) below, at the appropriate payment date), there shall be paid to the holder of the certificates
representing Company Shares that were exchanged for Consideration Shares pursuant to Section 2.3(e), without interest, (i) the amount
of dividends or other distributions with a record date after the Effective Time theretofore paid with respect to the Consideration Shares
to which such holder is entitled pursuant hereto, and (ii) to the extent not paid under clause (i), on the appropriate payment date,
the amount of dividends or other distributions with a record date after the Effective Time but prior to surrender and the payment date
subsequent to surrender payable with respect to such Consideration Shares.
3.3 Deemed
Fully Paid and Non-Assessable Shares
All Consideration
Shares issued pursuant to this Plan of Arrangement shall be deemed to be validly issued and outstanding as fully paid and non-assessable
shares.
3.4 No
Fractional Shares
No fractional
Consideration Shares shall be issued upon the exchange of Company Shares pursuant to Sections 2.3(e) and 3.1. Where the aggregate
number of Parent Shares to be issued to a Company Shareholder pursuant to Sections 2.3(e) and 3.1 as consideration under the Arrangement
would result in a fractional Consideration Share being issuable, such fractional Consideration Share shall be
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rounded up to the nearest
whole Parent Share in the event that a Company Shareholder is entitled to a fractional share representing 0.5 or more of a Parent Share
and shall be rounded down to the nearest whole Parent Share in the event that a Company Shareholder is entitled to a fractional share
representing less than 0.5 of a Parent Share.
3.5 Lost
Certificates
In the event
that any certificate which, immediately prior to the Effective Time, represented one or more outstanding Company Shares, which were exchanged
in accordance with Section 2.3(e) shall have been lost, stolen or destroyed, upon the making of an affidavit of that fact by the
holder claiming such certificate to be lost, stolen or destroyed, the Depositary shall deliver in exchange for such lost, stolen or destroyed
certificate, the aggregate Consideration which such holder is entitled to receive in accordance with this Plan of Arrangement. When authorizing
such delivery of the aggregate Consideration which such holder is entitled to receive in exchange for such lost, stolen or destroyed
certificate, the holder to whom the Consideration is to be delivered shall, as a condition precedent to the delivery of such Consideration,
give a bond satisfactory to Parent and the Depositary in such amount as Parent and the Depositary may direct (each acting reasonably),
or otherwise indemnify Parent and the Depositary and/or any of their respective representatives or agents in a manner satisfactory to
Parent and the Depositary (each acting reasonably), against any claim that may be made against Parent or the Depositary and/or any of
their respective representatives or agents with respect to the certificate alleged to have been lost, stolen or destroyed.
3.6 Extinction
of Rights
Any certificate
or DRS Advice which immediately prior to the Effective Time represented outstanding Company Shares that were exchanged pursuant to Section 2.3(e)
that is not deposited with all other instruments required by Section 3.1 on or prior to the sixth anniversary of the Effective Date
shall cease to represent a claim or interest of any kind or nature as a securityholder of Company, Parent Canadian Sub, Amalco. On such
date, the Consideration Shares, as applicable, to which the former holder of the certificate or DRS Advice referred to in the preceding
sentence was ultimately entitled shall be deemed to have been surrendered for no consideration to Parent Canadian Sub (or its successor(s)).
None of Parent, Parent Canadian Sub, Company, Amalco or the Depositary shall be liable to any Person in respect of any Consideration
Shares (or dividends, distributions and interest in respect thereof) delivered to a public official pursuant to any applicable abandoned
property, escheat or similar law.
3.7 Withholding
Rights; Tax Consequences
Parent, Company,
the Depositary, their respective Subsidiaries and any other Person on their behalf, shall be entitled to deduct and withhold from any
amounts payable to any Person pursuant to the Arrangement or under this Plan of Arrangement (including without limitation, any amounts
payable pursuant to Section 2.3, Article 3 and Article 4 of this Plan of Arrangement), and from all dividends, interest, and other
amounts payable or distributable to former Company Shareholders or former holders of Company Incentive Awards, such amounts as Parent,
Company, the Depositary and their respective Subsidiaries or any Person on behalf of any of the foregoing, is or may be required or permitted
to deduct or withhold with respect to such payment under the Tax Act, the U.S. Tax Code, or any provision of local, state, federal, provincial
or foreign Law, in each case, as amended, or under the administrative practice of the relevant Governmental Entity administering such
Law, and to request from any recipient of any payment hereunder any necessary tax forms or any other proof of exemption from withholding
or any similar information. To the extent that amounts are so deducted or withheld, such deducted or withheld amounts shall be treated
for all purposes hereof as having been paid to the Person to whom such amounts would otherwise have been paid. In any case where the
amount so required or permitted to be deducted or withheld from any payment to a holder exceeds the cash portion of the consideration
otherwise payable, Parent, Company, the Depositary, their respective Subsidiaries and any Person on behalf of the foregoing, as the case
may be, is authorized to sell or otherwise dispose of such portion of the Consideration as is necessary in order to fully fund such liability,
and such Person shall remit any unapplied balance of the net proceeds of such sale to the holder.
3.8 Transfer
Free and Clear
For greater certainty,
any transfer or exchange of securities pursuant to this Plan of Arrangement shall be free and clear of any Liens or other claims of third
parties of any kind.
| | SILVERCREST METALS INC. | B-11 |
| | | 2025 Special Meeting of Securityholders |
3.9 Interest
Under no circumstances
shall interest accrue or be paid by Company, Parent, Parent Canadian Sub, Amalco, the Depositary or any other Person to any Company Shareholder
or other Persons depositing certificates or DRS Advices pursuant to this Plan of Arrangement in respect of the Company Shares immediately
existing prior to the Effective Time.
ARTICLE 4
RIGHTS OF DISSENT
4.1 Dissent
Rights
| (a) | Pursuant
to the Interim Order, Company Shareholders who are registered holders of Company Shares as
of the record date of the Company Meeting may exercise rights to dissent in connection with
the Arrangement under Division 2 of Part 8 of the BCBCA, as modified by this Article 4, the
Interim Order and the Final Order (“Dissent Rights”), with respect to
all (but not less than all) of the Company Shares held by such Company Shareholder, provided
that the Notice of Dissent contemplated by Section 242 of the BCBCA, as may be modified by
the Interim Order, must be received by Company by 4:00 p.m. on the date that is at least
two business days prior to the date of the Company Meeting, or any date to which the Company
Meeting may be postponed or adjourned, and provided further that holders who duly exercise
such Dissent Rights and who: |
| (i) | are
ultimately entitled to be paid the fair value of their Dissent Shares: (A) will be entitled
to be paid the fair value of such Dissent Shares by Company, which fair value, notwithstanding
anything to the contrary contained in the BCBCA, shall be the fair value of such Dissent
Shares determined as of the close of business on the day immediately before the approval
of the Arrangement Resolution; (B) shall be deemed not to have participated in the transactions
in Article 2 (other than Section 2.3(d), if applicable); (C) shall be deemed to have
transferred and assigned such Dissent Shares, free and clear of any Liens, to Company in
accordance with Section 2.3(d); and (D) will not be entitled to any other payment or
consideration, including any payment that would be payable under the Arrangement had such
holders not exercised their Dissent Rights in respect of such Company Shares; and |
| (ii) | are
ultimately not entitled, for any reason, to be paid fair value for their Company Shares,
shall be deemed to have participated in the Arrangement, as of the Effective Time, on the
same basis as a non-dissenting registered holder of Company Shares, and shall be entitled
to receive only the Consideration pursuant to Section 2.3(e)
that such holder would have received pursuant to the Arrangement if such holder had not exercised Dissent Rights. |
| (b) | In
no circumstances shall Parent, Parent Canadian Sub, Company or any other Person be required
to recognize a Person exercising Dissent Rights unless such Person is the registered holder
of those Company Shares in respect of which such rights are sought to be exercised as of
the record date of the Company Meeting and as of the deadline for exercising such Dissent
Rights. |
| (c) | In
no case shall Parent, Parent Canadian Sub, Company or any other Person be required to recognize
holders of Company Shares who exercise Dissent Rights as holders of Company Shares after
the time that is immediately prior to the Effective Time, and the names of the Dissenting
Shareholders shall be deleted from the central securities register as holders of the Company
at the time at which the step in Section 2.3(d) occurs. |
| (d) | For
greater certainty, in addition to any other restrictions in the Interim Order and under Section
238 of the BCBCA, none of the following shall be entitled to exercise Dissent Rights: (i)
a holder of any Company Incentive Awards in respect of such holder’s Company Incentive
Awards; (ii) Company Shareholders who vote or have instructed a proxyholder to vote such
Company Shares in favour of the Arrangement Resolution; and (iii) any other Person who is
not a registered Company Shareholder as of the record date for the Company Meeting. |
| | SILVERCREST METALS INC. | B-12 |
| | | 2025 Special Meeting of Securityholders |
ARTICLE 5
GENERAL
5.1 Paramountcy
From and after
the Effective Time (a) this Plan of Arrangement shall take precedence and priority over any and all rights related to the Company Shares
and the Company Options issued prior to the Effective Time, and (b) the rights and obligations of the holders of Company Shares, the
holders of Company Options, the Parties, the Depositary and any trustee or transfer agent therefor in relation thereto, and any other
Person having any right, title or interest in or to Company Shares and Company Options, shall be solely as provided for in this Plan
of Arrangement.
5.2 Amendment
| (a) | Parent
and Company reserve the right to amend, modify or supplement this Plan of Arrangement at
any time and from time to time, provided that each such amendment, modification or supplement
must be (i) agreed to in writing by Company and Parent, (ii) filed with the Court and, if
made following the Company Meeting, approved by the Court, and (iii) communicated to Company
Shareholders and the holders of Company Options if and as required by the Court. |
| (b) | Subject
to the provisions of the Interim Order, any amendment, modification or supplement to this
Plan of Arrangement may be proposed by Parent and Company at any time prior to the Company
Meeting (provided, however, that Company and Parent shall have consented thereto in writing),
with or without any other prior notice or communication, and, if so proposed and accepted
by the Persons voting at the Company Meeting (other than as may be required under the Interim
Order), shall become part of this Plan of Arrangement for all purposes. |
| (c) | Any
amendment, modification or supplement to this Plan of Arrangement that is approved or directed
by the Court following the Company Meeting shall be effective only if: (i) it is consented
to in writing by each of Parent and Company (each acting reasonably); and (ii) if required
by the Court, it is consented to by the Company Shareholders voting in the manner directed
by the Court. |
| (d) | Any
amendment, modification or supplement to this Plan of Arrangement may be made by Company
and Parent without the approval of or communication to the Court or the Company Shareholders,
provided that it concerns a matter which, in the reasonable opinion of Company and Parent,
is of an administrative or ministerial nature required to better give effect to the implementation
of this Plan of Arrangement and is not adverse to the financial or economic interests of
any of the Company Shareholders or holders of Company Options. |
| (e) | This
Plan of Arrangement may be withdrawn prior to the Effective Time in accordance with the terms
of the Arrangement Agreement. |
5.3 Further
Assurances
Notwithstanding
that the transactions and events set out in this Plan of Arrangement shall occur and be deemed to have occurred in the order set out
herein, without any further act or formality, each of the Parties shall make, do and execute, or cause to be made, done and executed,
all such further acts, deeds, agreements, transfers, assurances, instruments or documents as may reasonably be required by any of them
in order to implement this Plan of Arrangement and to further document or evidence any of the transactions or events set out herein.
5.4 Plan
of Reorganization
| (a) | The
transfer of the Company Shares to Parent Canadian Sub pursuant to this Plan of Arrangement
is intended to qualify as a reorganization within the meaning of Section 368(a) of the U.S.
Tax Code for U.S. federal income tax purposes. |
| (b) | The
(i) election by Parent Canadian Sub on Internal Revenue Service Form 8832 (to be filed and
made effective as of one day after the Effective Date) to be classified as an association
taxable as a corporation for U.S. federal income tax purposes and (ii) conversion of Company
to a British Columbia unlimited liability company pursuant to Section 2.3(h) of this Plan
of |
| | SILVERCREST METALS INC. | B-13 |
| | | 2025 Special Meeting of Securityholders |
| | | Arrangement,
taken together, are intended to qualify as a reorganization within the meaning of Section 368(a)(1)(F)
of the U.S. Tax Code for U.S. federal income tax purposes. |
| (c) | The
conversion of Company Canadian Sub to a British Columbia unlimited liability company pursuant
to Section 2.3(i) of this Plan of Arrangement is intended to be treated as a complete liquidation
of Company Canadian Sub pursuant to Section 332 of the U.S. Tax Code for U.S. federal income
tax purposes. |
| (d) | The
Arrangement Agreement and this Plan of Arrangement are intended to be a “plan of reorganization”
with respect to each such reorganization within the meaning of the U.S. Treasury Regulations
promulgated under Section 368 of the U.S. Code. |
| (e) | The
Amalgamation pursuant to Section 2.3(k) of this Plan of Arrangement is intended to be a transaction
that is disregarded for U.S. federal income tax purposes. |
ARTICLE 6
U.S. SECURITIES LAW EXEMPTION
6.1 U.S.
Securities Law Exemption
Notwithstanding
any provision herein to the contrary, Company and Parent each agree that this Plan of Arrangement will be carried out with the intention
that (i) all Consideration Shares issued under the Arrangement by Parent, and (ii) all Parent Replacement Options granted under the Arrangement
by Parent, in each case, pursuant to this Plan of Arrangement, whether in the United States, Canada or any other country, be issued or
granted, as the case may be, in reliance on the exemption from the registration requirements of the U.S. Securities Act, as provided
by Section 3(a)(10) thereof and applicable state securities Laws, and pursuant to the terms, conditions and procedures set forth in the
Arrangement Agreement. To the extent necessary, Parent shall, on or as promptly as practicable following the Effective Date, file one
or more registration statements on Form S-8 with the U.S. SEC to register the issuance of Parent Shares upon exercise of Parent Replacement
Options.
| | SILVERCREST METALS INC. | B-14 |
| | | 2025 Special Meeting of Securityholders |
APPENDIX
C
INTERIM ORDER
See
attached.
| | SILVERCREST METALS INC. | C-1 |
No. S-250077
Vancouver Registry
IN THE SUPREME COURT OF BRITISH COLUMBIA
IN THE MATTER OF SECTION 288 OF THE BUSINESS
CORPORATIONS ACT,
S.B.C. 2002, CHAPTER 57, AS AMENDED
AND
IN THE MATTER OF A PROPOSED ARRANGEMENT INVOLVING
SILVERCREST METALS INC., ITS SECURITYHOLDERS, COMPAÑÍA MINERA LA
LLAMARADA, S.A. DE C.V., NORCREST METALS INC., COEUR MINING, INC., COEUR
ROCHESTER, INC., AND 1504648 B.C. UNLIMITED LIABILITY COMPANY
SILVERCREST METALS INC.
PETITIONER
ORDER MADE AFTER APPLICATION
(Interim Order)
| BEFORE |
)
)
) |
ASSOCIATE JUDGE |
)
)
) |
January 8, 2025 |
ON THE APPLICATION of the Petitioner, SilverCrest
Metals Inc. (“SilverCrest”) for an Interim Order pursuant to section 291 of the Business Corporations Act, S.B.C.
2002, c. 57, as amended (the “BCBCA”) in connection with a proposed arrangement (the “Arrangement”)
involving SilverCrest, its securityholders, Compañía Minera La Llamarada, S.A. DE C.V., NorCrest Metals Inc., Coeur Mining,
Inc. (“Coeur”), Coeur Rochester, Inc., and 1504648 B.C. Unlimited Liability Company, to be effected on the terms and
subject to the conditions set out in a plan of arrangement (the “Plan of Arrangement”), without notice, coming on for
hearing at 800 Smithe Street, Vancouver BC on January 8, 2025 and ON HEARING Rajit Mittal, counsel for the Petitioner, and Laura Bevan
for Coeur, and upon reading the Petition to the Court herein and the Affidavit #1 of Anna Ladd-Kruger affirmed January 6, 2025 and filed
herein (the “Ladd-Kruger Affidavit”); and UPON BEING ADVISED that it is the intention of the parties to rely upon Section
3(a)(10) of the United States Securities Act of 1933, as amended (the “US Securities
Act”), as the basis for an exemption from the registration requirements of the US Securities Act pursuant to section 3(a)(10)
thereof, for the issuance of securities in connection with the Arrangement;
THIS COURT ORDERS THAT:
DEFINITIONS
| 1. | As used in this Interim Order, unless otherwise defined, terms beginning with capital letters have the
respective meanings set out in the draft combined notice of meeting and management information circular (collectively, the “Circular”)
attached as Exhibit “A” to the Ladd-Kruger Affidavit. |
MEETING
| 2. | Pursuant to Sections 186 and 288-291 of the BCBCA, SilverCrest is authorized and directed to call, hold
and conduct a special meeting (the “Meeting”) of the holders (“Company Shareholders”) of common
shares (“Company Shares”) in the capital of SilverCrest, and the holders of options to purchase Company Shares (“Company
Options”) (holders of Company Options together with Company Shareholders, collectively, “Company Securityholders”)
to be held at Suite 2200, RBC Place, 885 West Georgia Street, Vancouver, British Columbia on February 6, 2025 at 10:00 a.m. (Vancouver
Time), or such other date as SilverCrest and Coeur may agree, to, among other things: |
| (a) | consider and, if deemed acceptable, to pass, with or without variation, a special resolution (the “Arrangement
Resolution”) of the Company Securityholders approving the Arrangement under Division 5 of Part 9 of the BCBCA, the full text
of which is set forth in Appendix “A” to the Circular; and |
| (b) | transact such further or other business, including amendments to the foregoing, as may properly be brought
before the Meeting or any adjournments or postponements thereof. |
| 3. | The Meeting shall be called, held and conducted in accordance with the BCBCA, the notice of articles and
articles of SilverCrest, and the Circular, subject to the terms of this Interim Order, and any further order of this Court, and the rulings
and directions of the chair of the Meeting, such rulings and directions not to be inconsistent with this Interim Order. |
ADJOURNMENT
| 4. | Notwithstanding the provisions of the BCBCA and the notice of articles and articles of SilverCrest, and
subject to the terms of the Arrangement Agreement, SilverCrest, if it deems advisable, is specifically authorized to adjourn, postpone
or cancel the Meeting or the date of the application for the Final Order (defined at paragraph 32 of this Interim Order) on one or more
occasions, without the necessity of first convening the Meeting or first obtaining any vote of the Company Securityholders respecting
such adjournment or postponement and without the need for approval of the Court. Subject to the terms of the Arrangement Agreement, notice
of any such cancellation, adjournments or postponements shall be given by news release, newspaper advertisement, or by notice sent to
the Company Securityholders by one of the methods specified in paragraph 9 of this Interim Order, as determined to be the most appropriate
method of communication by the board of directors of SilverCrest. |
| 5. | The Record Date (as defined in paragraph 7 below) shall not change in respect of any adjournments or postponements
of the Meeting unless required by this Court or by law. |
AMENDMENTS
| 6. | Prior to the Meeting, SilverCrest is authorized to make, in the manner contemplated by and subject to
the Arrangement Agreement, such amendments, modifications, revisions or supplements to the proposed Arrangement, the Plan of Arrangement,
the Arrangement Agreement and the Circular, without any additional notice to the Company Securityholders |
or further orders of this Court, and the
Arrangement, Plan of Arrangement, Arrangement Agreement, and Circular as so amended, modified, revised or supplemented shall be the Arrangement,
Plan of Arrangement, the Arrangement Agreement or the Circular, respectively, to be submitted to the Company Securityholders for the Meeting
and, as applicable, subject to the Arrangement Resolution.
RECORD DATE
| 7. | The record date for determining the Company Securityholders entitled to receive notice of, attend at and
vote at the Meeting shall be the close of business in Vancouver, British Columbia on December 19, 2024 (the “Record Date”). |
NOTICE OF MEETING
| 8. | The Circular is hereby deemed to represent sufficient and adequate disclosure, including for the purpose
of Section 290(1)(a) of the BCBCA, and SilverCrest shall not be required to send to the Company Securityholders any other or additional
statement pursuant to Section 290(1)(a) of the BCBCA. |
| 9. | The Circular and the Notice of Hearing of Petition, in substantially the same forms as contained in Exhibits
“A” and “B” to the Ladd-Kruger Affidavit (collectively referred to as the “Notice Materials”),
and in the case of the Company Securityholders, the forms of proxy, voting instruction form, and letter of transmittal, in substantially
the same forms as contained in Exhibit “C” to the Ladd-Kruger Affidavit (together with the Notice Materials, the “Meeting
Materials”), with such deletions, amendments or additions thereto as counsel for SilverCrest may advise are necessary or desirable,
provided that such deletions, amendments or additions are not inconsistent with the terms of this Interim Order, shall be sent to: |
| (a) | the registered Company Shareholders as they appear on the central securities register of SilverCrest or,
in respect of holders of Company Options, the applicable records of SilverCrest or its registrar and transfer agent, as the case may be,
in each case, as at the close of business on the Record Date at least 21 days prior to the date of the Meeting, by one or more of the
following methods: |
| (i) | by prepaid ordinary or air mail addressed to the registered Company Securityholders at their addresses
as they appear in the applicable records of SilverCrest or its registrar and transfer agent, as at the Record Date; |
| (ii) | by delivery in person or by courier to the addresses specified in subparagraph (i) above; or |
| (iii) | by email or facsimile transmission to any registered Company Securityholders, who has previously identified
himself, herself or itself to the satisfaction of SilverCrest, acting through its representatives, and who requests such email or facsimile
transmission; and |
| (b) | the non-registered Company Shareholders by providing, in accordance with National Instrument 54-101 —
Communications with Beneficial Owners of Securities of a Reporting Issuer of the Canadian Securities Administrators (“NI
54-101”), the requisite number of copies of the Meeting Materials to intermediaries |
and registered nominees to facilitate the
distribution of the Meeting Materials to the beneficial owners of Company Shares in accordance with NI 54-101;
| (c) | the directors and auditors of SilverCrest by prepaid ordinary mail or by delivery in person or by courier,
or by email or facsimile transmission, to such persons at least 21 days prior to the date of the Meeting; |
and substantial compliance with this paragraph
shall constitute good and sufficient notice of the Meeting and delivery of the Meeting Materials.
| 10. | The Notice Materials shall be sent by prepaid ordinary mail or by delivery in person or by courier, or
by email transmission to the holders of deferred share units to purchase Company Shares, the holders of restricted share units to purchase
Company Shares, and the holders of performance share units to purchase Company Shares (collectively, “Company Incentive Unit
Holders”), to the address of such holder as it appears in the applicable records of SilverCrest at least 21 days prior to the
date of the Meeting. |
| 11. | Accidental failure of or omission by SilverCrest to give notice to any one or more persons entitled thereto,
or the non-receipt of such notice by one or more persons entitled thereto, or any failure or omission to give such notice as a result
of events beyond the reasonable control of SilverCrest (including, without limitation, any inability to use postal services), shall not
constitute a breach of this Interim Order or a defect in the calling of the Meeting, and shall not invalidate any resolution passed or
proceeding taken at the Meeting, but if any such failure or omission is brought to the attention of SilverCrest, then it shall use reasonable
best efforts to rectify it by the method and in the time most reasonably practicable in the circumstances. |
| 12. | Provided that notice of the Meeting is given, the Meeting Materials are made available to Company Securityholders,
and in each case to other persons entitled to be provided such materials in compliance with this Interim Order, the requirement of Section
290(1)(b) of the BCBCA to include certain disclosure in any advertisement of the Meeting is waived and no other form of service of the
Meeting Materials or any portion thereof need be made or notice given, or other material served in respect of these proceedings or the
Meeting, except to the extent required by paragraph 9 above or as may be directed by a further order of this Court. |
DEEMED RECEIPT OF NOTICE
| 13. | The Notice Materials and Meeting Materials (and any amendments, modifications, updates or supplements
to the Notice Materials or Meeting Materials and any notice of adjournment or postponement of the Meeting) shall be deemed, for the purposes
of this Interim Order, to have been served upon and received: |
| (a) | in the case of mailing pursuant to paragraphs 9(a)(i), 9(c), and 10 above, the day, Saturdays, Sundays
and holidays excepted, following the date of mailing; |
| (b) | in the case of delivery in person pursuant to paragraph 9(a)(ii) above, the day following personal delivery
or, in the case of delivery by courier, the day following delivery to the person’s address in paragraph 9 above; |
| (c) | in the case of any means of transmitted, recorded or electronic communication pursuant to paragraphs 9(a)(iii),
9(c), and 10 above, when dispatched or delivered for dispatch; and |
| (d) | in the case of delivery to clearing agencies or intermediaries for onward distribution pursuant to paragraph
9(b) above, the day following delivery to clearing agencies or intermediaries. |
UPDATING MEETING MATERIALS
| 14. | Notice of any amendments, modifications, updates or supplements to any of the information provided in
the Meeting Materials may be communicated, at any time prior to the Meeting, to the Company Securityholders by press release, news release,
newspaper advertisement or by notice sent to the Company Securityholders by any of the means set forth in paragraph 9, as determined to
be the most appropriate method of communication by the board of directors of SilverCrest. |
QUORUM AND VOTING
| 15. | The quorum required at the Meeting shall be two (2) persons, present in person or by proxy, being Company
Shareholders entitled to vote at the Meeting, and who hold at least five percent (5%) of the issued and outstanding Company Shares entitled
to vote at the Meeting. |
| 16. | Each registered Company Securityholder whose name appears on the register of holders of Company Shares
or Company Options as the case may be, in each case, as of the close of business in Vancouver, British Columbia, on the Record Date, is
entitled to one vote for each Company Share or Company Option, as applicable. |
| 17. | The vote required to pass the Arrangement Resolution shall be the affirmative vote of at least: (i) two-thirds
(66⅔%) of the votes cast at the Meeting by the Company Shareholders present or represented by proxy at the Meeting; (ii) two-thirds
(66⅔%) of the votes cast at the Meeting by Company Securityholders, collectively voting as a single class, present or represented
by proxy at the Meeting; and (iii) a simple majority of the votes cast by the Company Shareholders present or represented by proxy
at the Meeting, excluding the Company Shares required to be excluded in accordance with Multilateral Instrument 61-101 — Protection
of Minority Security Holders in Special Transactions. |
CHAIR OF THE MEETING
| 18. | The chair of the Meeting shall be an officer or director of SilverCrest or such other person as may be
appointed for that purpose. |
| 19. | The chair of the Meeting is at liberty to call on the assistance of legal counsel of SilverCrest at any
time and from time to time, as the chair of the Meeting may deem necessary or appropriate, during the Meeting. |
| 20. | The chair of the Meeting shall be permitted to ask questions of, and demand the production of evidence,
from the Company Securityholders or such other persons in attendance or represented at the Meeting, as he, she, they or it considers appropriate
having regard to the orderly conduct of the Meeting, the authority of any person to vote at the Meeting, and |
the validity and propriety of the votes
cast and the proxies submitted in respect of the Arrangement Resolution.
| 21. | The chair or another representative of SilverCrest present at the Meeting shall, in due course after the
Meeting, file with the Court an affidavit verifying the actions taken and the decisions reached at the Meeting with respect to the Arrangement. |
PERMITTED ATTENDEES
| 22. | The only persons entitled to attend the Meeting shall be (i) the registered Company Securityholders as
of the close of business in Vancouver, British Columbia on the Record Date, or their respective proxyholders, (ii) SilverCrest’s
directors, officers, auditors and advisors, (iii) representatives of SilverCrest and Coeur, including any of their respective directors,
officers and advisors, and (iv) any other person admitted on the invitation of the chair of the Meeting or with the consent of the chair
of the Meeting, and the only persons entitled to be represented and to vote at the Meeting shall be the registered Company Securityholders
as at the close of business in Vancouver, British Columbia, on the Record Date, or their respective proxyholders. |
SCRUTINEERS
| 23. | Representatives of SilverCrest’s registrar and transfer agent (or any agent thereof) are authorized
to act as scrutineers for the Meeting. |
SOLICITATION OF PROXIES
| 24. | SilverCrest is authorized to use the forms of proxy (in substantially the same forms as attached as Exhibit
“C” to the Ladd-Kruger Affidavit) in connection with the Meeting, subject to SilverCrest’s ability to insert dates and
other relevant information in the final forms thereof, as well as a voting instruction form for non-registered Company Shareholders and,
subject to the Arrangement Agreement, with such amendments, revisions or supplemental information as SilverCrest may determine are necessary
or desirable. SilverCrest is authorized, at its expense, to solicit proxies, directly and through its officers, directors and employees,
and through such agents or representatives as it may retain for the purpose, and by mail, telephone or such other forms of personal or
electronic communication as it may determine. |
| 25. | The procedure for the use of proxies at the Meeting shall be as set out in the Meeting Materials. The
chair of the Meeting may, in his, her, or their discretion, without notice, waive or extend the time limits for the deposit of proxies
by the Company’s Securityholders if he or she deems it advisable to do so, such waiver or extension to be endorsed on the proxy
by the initials of the chair of the Meeting. |
DISSENT RIGHTS
| 26. | Each registered Company Shareholder who is a registered Company Shareholder as of the Record Date shall,
as set out in the Plan of Arrangement, be entitled to exercise dissent rights (“Dissent Rights”) in respect of the
Arrangement Resolution under Division 2 of Part 8 of the BCBCA, as modified by the Plan of Arrangement, this Interim Order, and the Final
Order. |
| 27. | Registered Company Shareholders shall be the only Company Shareholders entitled to exercise Dissent Rights.
A beneficial holder of Company Shares registered in the name of a broker, custodian, trustee, nominee or other intermediary who wishes
to dissent must make arrangements for the registered Company Shareholder to dissent on behalf of the beneficial holder of Company Shares
or, alternatively, make arrangements to become a registered Company Shareholder. |
| 28. | In order for a registered Company Shareholder to exercise Dissent Rights: |
| (a) | a dissenting registered Company Shareholder must deliver written notice of dissent (a “Notice
of Dissent”) to SilverCrest c/o Cassels, Brock & Blackwell LLP, Suite 2200, RBC Place, 885 West Georgia Street, Vancouver,
BC V6C 3E8 Canada, Attention: Rajit Mittal Canada by 4:00 p.m. (Vancouver time) on or before February 4, 2025, or by 4:00 p.m. (Vancouver
time) on the Business Day that is two Business Days immediately preceding the Meeting if it is not held on February 6, 2025, and such
Notice of Dissent must strictly comply with the requirements of section 242 of the BCBCA; |
| (b) | a dissenting registered Company Shareholder must not have voted his, her, their, or its Company Shares
at the Meeting, either by proxy or in person, in favour of the Arrangement Resolution, and a vote against the Arrangement Resolution or
an abstention shall not constitute written Notice of Dissent; |
| (c) | a dissenting registered Company Shareholder may not exercise Dissent Rights in respect of only a portion
of such dissenting registered Company Shareholder’s Company Shares, but may dissent only with respect to all the Company Shares
held by such person; and |
| (d) | the exercise of such Dissent Right must otherwise comply with the requirements of Sections 237 to 247
of the BCBCA, as modified by the Plan of Arrangement, this Interim Order, and the Final Order. |
| 29. | Any registered Company Shareholder who duly exercises Dissent Rights and who: |
| (a) | is ultimately determined by this Court to be entitled to be paid fair value for his, her, their, or its
Company Shares shall be deemed to have transferred those Company Shares as of the Effective Time (as defined in the Circular), without
any further act or formality and free and clear of all liens, claims, encumbrances, charges, adverse interests or security interests to
SilverCrest for cancellation in consideration for a payment of cash from SilverCrest equal to such fair value; or |
| (b) | is for any reason ultimately determined by this Court not to be entitled to be paid fair value for his,
her or its Company Shares pursuant to the exercise of the Dissent Rights, shall be deemed to have participated in the Arrangement on the
same basis and at the same time as any non-dissenting Company Shareholder; |
but in no case shall SilverCrest or Coeur
or any other person be required to recognize such Company Shareholders as holders of Company Shares at or after the date upon which the
Arrangement becomes effective and the names of such Company Shareholders shall be deleted from SilverCrest’s register of holders
of Company Shares at that time.
| 30. | Notice to the registered Company Shareholders of their Dissent Rights with respect to the Arrangement
Resolution shall be given by including information with respect to the Dissent Rights in the Circular to be sent to registered Company
Shareholders in accordance with this Interim Order. |
| 31. | Subject to further order of this Court, the rights available to the registered Company Shareholders under
the BCBCA and the Plan of Arrangement to dissent from the Arrangement will constitute full and sufficient Dissent Rights for the registered
Company Shareholders with respect to the Arrangement. |
APPLICATION FOR FINAL ORDER
| 32. | Upon the approval, with or without variation, by the Company Securityholders of the Arrangement Resolution,
in the manner set forth in this Interim Order, SilverCrest may apply to this Court for, inter alia, an order: |
| (a) | pursuant to s. 291(4)(a) of the BCBCA, approving the Arrangement; and |
| (b) | pursuant to s. 291(4)(c) of the BCBCA, declaring that the terms and conditions of the Arrangement, and
the distribution of securities to be effected by the Arrangement, are procedurally and substantively fair and reasonable |
(collectively, the “Final Order”),
and the hearing of the Final Order shall
be held in person at the Courthouse at 800 Smithe Street, Vancouver, British Columbia at 9:45 a.m. (Vancouver time) on February 11, 2025,
or as soon thereafter as the hearing of the Final Order can be heard, or at such other date and time as this Court may direct.
| 33. | The form of Notice of Hearing of Petition in connection with the Final Order attached to the Ladd-Kruger
Affidavit as Exhibit “B” is hereby approved as the form of Notice of Proceedings for such approval. Any Company Securityholder
or Company Incentive Unit Holder has the right to appear (either in person or by counsel) and make submissions at the hearing of the application
for the Final Order, subject to the terms of this Interim Order. |
| 34. | Any Company Securityholder or Company Incentive Unit Holder seeking to appear at the hearing of the application
for the Final Order must file and deliver a Response to Petition (a “Response”) in the form prescribed by the Supreme
Court Civil Rules, and a copy of all affidavits or other materials upon which they intend to rely, to the Petitioner’s solicitors
at: |
CASSELS, BROCK & BLACKWELL LLP
Barristers and Solicitors
2200 - 885 West Georgia St.
Vancouver, British Columbia, Canada V6C 3E8
Attention: Rajit Mittal
Fax number for delivery: (604) 691-6120
Telephone: (778) 309-7940
by or before 4:00 p.m. (Vancouver time)
on the date that is two Business Days prior to the date of the hearing of the application for the Final Order.
| 35. | Sending the Notice of Hearing of Petition in connection with the Final Order and this Interim Order in
accordance with paragraphs 9 and 10 of this Interim Order shall constitute good and sufficient service of this proceeding and no other
form of service need be made and no other material need be served on persons in respect of these proceedings, except as provided in paragraphs
36 and 37 below. In particular, service of the Petition, the Ladd-Kruger Affidavit, and additional affidavits as may be filed, is dispensed
with. |
| 36. | The only persons entitled to notice of any further proceedings herein, including any hearing to approve
the Arrangement, and to appear and be heard thereon, shall be the solicitors for Coeur and any persons who have delivered a Response in
accordance with this Interim Order. |
| 37. | In the event the hearing for the Final Order is adjourned, only the solicitors for Coeur and those persons
who have filed and delivered a Response in accordance with this Interim Order need be provided with notice of the adjourned hearing date
and any filed materials. |
VARIANCE
| 38. | The Petitioner shall, subject to the terms of the Arrangement Agreement, be entitled, at any time, to
apply to vary this Interim Order or for such further order or orders as may be appropriate. |
| 39. | To the extent of any inconsistency or discrepancy between this Interim Order and the Circular, the BCBCA,
applicable Securities Laws or the notice of articles and articles of SilverCrest, this Interim Order shall govern. |
THE FOLLOWING PARTIES APPROVE THE FORM OF THIS
ORDER AND CONSENT TO EACH OF THE ORDERS, IF ANY, THAT ARE INDICATED ABOVE AS BEING BY CONSENT:
| /s/ Rajit Mittal |
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| Signature of Lawyer for SilverCrest Metals Inc. |
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| Rajit Mittal |
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| /s/ Laura Bevan |
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| Signature of Lawyer for Coeur Mining, Inc. |
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| Tom Friedland / Laura Bevan |
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By the Court |
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Registrar |
No. S-250077
Vancouver Registry
IN THE SUPREME COURT OF BRITISH COLUMBIA
IN THE MATTER OF SECTION 288 OF THE BUSINESS
CORPORATIONS ACT, S.B.C. 2002, CHAPTER 57,
AS AMENDED
AND
IN THE MATTER OF A PROPOSED ARRANGEMENT INVOLVING
SILVERCREST METALS INC., ITS SECURITYHOLDERS, COMPAÑÍA MINERA LA
LLAMARADA, S.A. DE C.V., NORCREST METALS INC., COEUR MINING, INC., COEUR
ROCHESTER, INC., AND 1504648 B.C. UNLIMITED LIABILITY COMPANY
SILVERCREST METALS INC.
PETITIONER
ORDER MADE AFTER APPLICATION
(Interim Order)
CASSELS BROCK & BLACKWELL LLP
Lawyers
2200 —
885 West Georgia Street
Vancouver, B.C. V6C 3E8
Telephone: (778) 309-7940
E-mail: rmittal@cassels.com
Attention: Rajit Mittal
Matter# 054862-00008
FILING AGENT: WEST COAST TITLE SEARCH
| | | 2025 Special Meeting of Securityholders |
APPENDIX
D
PETITION AND NOTICE OF HEARING OF PETITION
See attached.
| | SILVERCREST METALS INC. | D-1 |
No.S-250077
Vancouver Registry
IN THE SUPREME COURT OF BRITISH COLUMBIA
IN THE MATTER OF SECTION 288 OF THE BUSINESS
CORPORATIONS ACT,
S.B.C. 2002, CHAPTER 57, AS AMENDED
AND
IN THE MATTER OF A PROPOSED ARRANGEMENT INVOLVING
SILVERCREST METALS INC., ITS SECURITYHOLDERS, COMPAÑÍA MINERA LA
LLAMARADA, S.A. DE C.V., NORCREST METALS INC., COEUR MINING, INC., COEUR
ROCHESTER, INC., AND 1504648 B.C. UNLIMITED LIABILITY COMPANY
SILVERCREST METALS INC.
PETITIONER
PETITION TO THE COURT
This proceeding has been started by the petitioner
for the relief set out in Part 1 below.
The address of the registry is: Vancouver Law
Courts — 800 Smithe Street, Vancouver, BC V6Z 2E1
The petitioner estimates that the hearing of
the petition will take 20 minutes.
| () |
This matter is an application for judicial
review. |
| |
|
| (x) |
This
matter is not an application for judicial review. |
If you intend to respond to this petition, you
or your lawyer must
| (a) | file a response to petition in Form 67 in the above-named registry of this court within the time for response
to petition described below, and |
| (b) | serve on the petitioner |
| (i) | 2 copies of the filed response to petition, and |
| (ii) | 2 copies of each filed affidavit on which you intend to rely at the hearing. |
Orders, including orders granting the relief
claimed, may be made against you, without any further notice to you, if you fail to file the response to petition within the time for
response.
Time for response to petition
A response to petition must be filed and served
on the petitioner,
| (a) | if you reside anywhere within Canada, within 21 days after the date on which a copy of the filed petition
was served on you, |
| (b) | if you reside in the United States of America, within 35 days after the date on which a copy of the filed
petition was served on you, |
| (c) | if you reside elsewhere, within 49 days after the date on which a copy of the filed petition was served
on you, or |
| (d) | if the time for response has been set by order of the court, within that time. |
| |
The address of the registry is: |
800 Smithe Street
Vancouver, BC V6Z 2E1 |
| (2) |
The ADDRESS FOR SERVICE of the petitioner is: |
Cassels Brock & Blackwell LLP
885 West Georgia St., Vancouver, British Columbia, V6C
3E8
Attention: Rajit Mittal
Telephone: 778.309.7940
Email: rmittal@cassels.com |
| |
E-mail address for service (if any) of the petitioner: |
N/A |
| (3) |
The name and office address of the petitioner’s lawyer is: |
Cassels Brock & Blackwell LLP 885 West Georgia St.,
Vancouver, British Columbia, V6C 3E8 Attention: Rajit Mittal
Telephone: 778.309.7940 |
CLAIM OF THE PETITIONER
PART 1: ORDERS SOUGHT
| 1. | The Petitioner SilverCrest Metals Inc. (“SilverCrest” or the “Company”)
applies to this Court pursuant to sections 288 and 291 of the Business Corporations Act, S.B.C.
2002, c. 57, as amended or superseded (the “BCBCA”), Rules 16-1, 4-4, 4-5 and 2-1(2)(b) of the Supreme Court Civil
Rules and the inherent jurisdiction of this Court for: |
| (a) | an interim order (the “Interim Order”) in the form attached as Schedule “A”
to this Petition to the Court; |
| (b) | an order (the “Final Order”) in the form attached as Schedule “B”
to this Petition to the Court; and |
| (c) | such further and other relief as counsel may advise and this Court deems just. |
PART 2: FACTUAL BASIS
| 2. | Unless otherwise defined herein, capitalized terms in this Petition have the respective meaning as defined
in the draft combined notice of meeting and management information circular of SilverCrest (collectively, the “Circular”),
which is attached as Exhibit “A” to the Affidavit #1 of Anna Ladd-Kruger made January 6, 2025. |
Parties To the Arrangement
A. SilverCrest Metals Inc.
| 3. | The Company is incorporated pursuant to the laws of British Columbia. The head office of the Company is
located at Suite 501, 570 Granville Street, Vancouver, British Columbia, V6C 3P1. The registered office of the Company is located at 19th
Floor, 885 West Georgia Street, Vancouver, British Columbia, V6C 3H4. |
| 4. | The authorized capital of the Company consists of an unlimited number of Company Shares without par value. |
| 5. | The Company is a reporting issuer (or its equivalent) in all of the Provinces of Canada except Québec.
The shares of the Company are currently listed and posted for trading on the TSX under the symbol “SIL”
and the NYSE American under the symbol “SILV”. |
| 6. | The Company is a Canadian-based precious metals producer head-quartered in Vancouver, BC with an ongoing
initiative to increase its silver-gold assets by expanding current resources and reserves, acquiring, discovering, developing and operating
high value previous metals projects in the Americas. The Company’s principal focus is operating its Las Chispas Operation in Sonora,
Mexico. |
B. Coeur Mining, Inc.
| 7. | Coeur Mining, Inc. (“Coeur”) is a corporation existing under the laws of the State
of Delaware. Coeur is a precious metals producer that operates certain gold and silver mines in the United States, Canada and Mexico and
is headquartered in Chicago, Illinois, USA. Coeur produces and sells previous metals from four wholly-owned operations: the Palmarejo
gold-silver complex in Mexico, the Rochester silver-gold mine in Nevada, the Kensington gold mine in Alaska and the Wharf gold mine in
South Dakota. In addition, Coeur wholly-owns the Silvertip polymetallic critical minerals exploration project in British Columbia. |
| 8. | Coeur is a publicly listed company. Its shares trade on the NYSE under the symbol “CDE”. |
| 9. | Coeur, through a wholly owned subsidiary, 1504648 B.C. Unlimited Liability Company, an unlimited liability
company existing under the laws of the Province of British Columbia (“Coeur Canadian Sub”), proposes to acquire SilverCrest
as described herein. |
The Arrangement
| 10. | SilverCrest and Coeur and certain of their subsidiaries, including the Coeur Canadian Sub, have entered
into an arrangement agreement dated as of October 3, 2024 (the “Arrangement Agreement”) which contemplates the occurrence
of certain transactions pursuant to a court approved statutory plan of arrangement (the “Arrangement”) under Section
288 of the BCBCA. |
| 11. | The proposed plan of arrangement (the “Plan of Arrangement”) is attached as Schedule
“A” to the draft Final Order, which is attached as Schedule “B” to this Petition to the Court. |
| 12. | Pursuant to the Arrangement, and as detailed further below, the holders (“Company Shareholders”)
of common shares (“Company Shares”) of the Company, other than any Company Shareholders validly exercising dissent
rights, will receive as consideration (the “Consideration”) 1.6022 Coeur common shares (“Coeur Shares”)
for each Company Share (the “Exchange Ratio”). For holders (“Company Optionholders”) of options
to purchase Company Shares (“Company Options”), each outstanding Company Option will be exchanged for an option (“Replacement
Option”) to purchase from Coeur such number of Coeur Shares (rounded down to the nearest whole number) equal to the product
of: (A) the number of Company Shares subject to such Company Options immediately prior to the effective time of the Arrangement (the “Effective
Time”), multiplied by (B) the Exchange Ratio, at an exercise price per Coeur Share (rounded up to the nearest whole cent) equal
to (X) the exercise price per Company Share otherwise purchasable pursuant to such SilverCrest Option immediately prior to the Effective
Time, divided by (Y) the Exchange Ratio. |
| 13. | The Company also has outstanding deferred share units to purchase Company Shares (“Company DSUs”),
restricted share units to purchase Company Shares (“Company RSUs”), and performance share units to purchase Company
Shares (“Company PSUs”). Immediately prior to the Effective Time, on the terms and subject to the conditions of the
Arrangement Agreement and the applicable Company Equity Incentive Plan, each outstanding (i) Company RSU granted pursuant to the Company
Share Unit Plan; (ii) Company PSU granted pursuant to the Company Share Unit Plan; (iii) Company DSU granted pursuant to the Company Share
Unit Plan or the Company DSU Plan, as applicable, in each case, will become fully vested, and be redeemed by the Company and the holder
thereof will receive a cash payment to be calculated in accordance with the terms of the applicable Company Equity Incentive Plan. |
| 14. | The Arrangement is subject to obtaining the necessary approvals, including the approval of the holders
of Company Shares (“Company Shareholders”) and the holders of Company Options (“Company Optionholders”,
and collectively with Company Shareholders, “Company Securityholders”) at the special meeting of Company Securityholders
(the “Meeting”) to be held on February 6, 2025 at 10:00 a.m. (Vancouver Time) in person at Suite 2200, RBC Place, 885
West Georgia Street, Vancouver, British Columbia, and via live webcast for non-voting attendance. |
| 15. | In order for the Arrangement to become effective, the Arrangement must be approved, with or without variation,
by a special resolution substantially in the form attached as Appendix “A” to the Circular (the “Arrangement Resolution”)
by at least: (i) two-thirds (662/3%) of the votes cast at the Meeting by the Company Shareholders present or represented
by proxy at the Meeting; (ii) two-thirds (66 2/3%) of the votes cast at the Meeting by Company
Securityholders, collectively voting as a single class, present or represented by proxy at the Meeting; and (iii) a simple majority of
the votes cast by the Company Shareholders present or represented by proxy at the Meeting, excluding the Company Shares required to be
excluded in accordance with Multilateral Instrument 61-101 — Protection of
Minority Security Holders in Special Transactions (“MI 61-101”). |
| 16. | If the Arrangement is approved, at the Effective Time, the following shall be deemed to occur sequentially
in the following order in connection with the Arrangement: |
| (a) | Transfer of Bullion: All Bullion beneficially owned by the Company shall be, and shall be deemed
to be, transferred to the Company’s wholly-owned Canadian subsidiary, NorCrest Metals Inc. (“Company Canadian Sub”),
pursuant to Section 85 of the Income Tax Act (“Tax Act”) and, in consideration therefor, the Company Canadian Sub shall
(i) allot and issue one (1) common share of the Canadian Sub (“Company Canadian Sub Shares”) to the Company, and (ii)
issue a U.S. dollar denominated, non-interest bearing, demand promissory note in favour of the Company with a principal amount equal to
the Company’s cost amount of the Bullion (for the purpose of the Tax Act), and the Company and Company Canadian Sub shall file a
joint election under Section 85 of the Tax Act and applicable provincial tax Laws with an elected amount determined by the Company in
its sole discretion. Subsequently, the Company Canadian Sub shall transfer, and shall be deemed to transfer, all Bullion referred to above
to Coeur’s wholly-owned subsidiary, Coeur Rochester Inc. (“Coeur U.S. Sub”) and, in consideration therefor, Coeur
U.S. Sub shall issue and deliver to the Company Canadian Sub a U.S. dollar denominated promissory note, with a principal amount equal
to the purchase price of the Bullion, being the fair market value thereof, bearing interest at the short-term Applicable Federal Rate
for U.S. tax purposes on the Effective Date plus 2% per annum, having a maturity date that is December 31 of the year following the Effective
Date. |
| (b) | Payment of Intercompany Debt: Compañía Minera La Llamarada, S.A. De C.V. (“Company
Mexican Sub”), an indirectly wholly-owned Mexican subsidiary of the Company, shall transfer a cash amount: (i) to the Company
equal to the lesser of (A) the principal amount outstanding under the Company Loan and (B) Company Mexican Sub’s Specified Cash
Balance; (ii) if Company Mexican Sub’s Specified Cash Balance less the repayment described in (i) is positive, to the Company equal
to the lesser of (C) any accrued interest on the Company Loan and (D) Company Mexican Sub’s Specified Cash Balance less the amount
of the repayment described in (i); and (iii) if Company Mexican Sub’s Specified Cash Balance less the repayments described in (i)
and (ii) is positive, to Company Canadian Sub
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equal to the lesser of (E) the interest
owing on that certain intercompany loan between Company Mexican Sub and Company Canadian Sub and (F) Company Mexican Sub’s Specified
Cash Balance less the amount of the repayments described in (i) and (ii); and following this step, such amounts determined by this step
shall be, and shall be deemed to be, repaid by Company Mexican Sub.
| (c) | Dissenting Shareholders: Each Dissent Share shall be and shall be deemed to be transferred and
assigned by the holder thereof without any further act or formality on its part, free and clear of all Liens, to the Company in accordance
with, and for the consideration afforded to Dissenting Shareholders under the Plan of Arrangement, and such Dissenting Shareholder shall
cease to be, and shall be deemed to cease to be, the registered holder of each such Dissent Share and the Company shall be the holder
of all of the outstanding Dissent Shares, free and clear of all Liens. |
| (d) | Issuance of Company Shares to Coeur Canadian Sub: Each Company Shareholder, other than a Dissenting
Shareholder, shall transfer and assign their Company Shares, free and clear of any Liens, to Coeur Canadian Sub in exchange for the Consideration
for each such Company Share so transferred, and in respect of the Company Shares so transferred, the registered holder thereof shall cease
to be, and shall be deemed to cease to be, the registered holder of each such Company Share and Coeur Canadian Sub shall be the holder
of all of the outstanding Company Shares, free and clear of all Liens. |
| (e) | Treatment of Company Options: Notwithstanding any vesting or exercise or other provisions to which
a Company Option might otherwise be subject (whether by contract, the conditions of grant, applicable Law or the terms of the applicable
Company Option Plan governing such Company Option), each Company Option outstanding immediately prior to the Effective Time shall, without
any further action by or on behalf of a holder, be exchanged for a Replacement Option exercisable to purchase from Coeur the number of
Coeur Shares (rounded down to the nearest whole number) equal to the product of (A) the number of Company Shares subject to the Company
Option immediately before the Effective Time multiplied by (B) the Exchange Ratio. The exercise price per Coeur Share subject to any such
Replacement Option shall be an amount (rounded up to the nearest whole cent) equal to the quotient of (X) the exercise price per Company
Share underlying the exchanged Company Option immediately prior to the Effective Time divided by (Y) the Exchange Ratio. It is intended
that (i) the provisions of Subsection 7(1.4) of the Tax Act apply to the aforesaid exchange of options and (ii) such exchange of options
be treated as other than the grant of a new stock right or a change in the form of payment pursuant to Section 1.409A-1(b)(5)(v)(D) of
the U.S. Treasury Regulations. Accordingly, and notwithstanding the foregoing, if required, the exercise price of a Replacement Option
will be adjusted such that the In-The-Money Value of the Replacement Option immediately after the exchange does not exceed the In-The-Money
Value of the Company Option for which it was
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exchanged immediately before the exchange.
All terms and conditions of a Replacement Option, including the term to expiry, conditions to and manner of exercising, will be the same
as the Company Option for which it was exchanged, and shall be governed by the terms of the applicable Company Option Plan and any document
evidencing a Company Option shall thereafter evidence and be deemed to evidence such Replacement Option, provided that the provisions
of Section 7.1 of the New Company Option Plan shall apply to all Replacement Options that would otherwise be governed by the Legacy Company
Option Plan for a period of ninety (90) days following the Effective Time.
| (f) | Amalgamation of the Company and Company Canadian Sub: At 9:00 a.m. (Vancouver time) on the day
following the Effective Date, the notice of articles of the Company shall be altered to the extent necessary for the Company to become
an unlimited liability company as contemplated pursuant to Section 51.31(1) of the BCBCA, such that (i) the statement required under Section
51.11 of the BCBCA shall be included in the notice of articles of the Company; (ii) the name of the Company shall be changed to “SilverCrest
Metals ULC” and the Company shall thereupon be an unlimited liability company under the BCBCA and, as soon as practicable thereafter,
Coeur Canadian Sub, as sole shareholder of the Company, shall return all share certificates representing the Company Shares for inclusion
on the face of each such certificate the statement required pursuant to Section 51.2 of the BCBCA; and (iii) Coeur Canadian Sub shall
elect to be classified as an association taxable as a corporation for U.S. federal income tax purposes effective the day following the
Effective Date. |
Background and Reasons for the Arrangement
| 17. | The background to the Arrangement and its business rationales are described in detail at pages 52-62 of
the Circular. |
| 18. | The Arrangement Agreement is the culmination of a comprehensive strategic review process overseen by the
Company’s board of directors (the “Board”) and the special committee of independent directors of the Board (the
“Special Committee”) and is the direct result of extensive arm’s length negotiations among representatives of
SilverCrest and the Special Committee, representatives of Coeur, and their respective financial and legal advisors. |
| 19. | Having thoroughly reviewed and carefully considered the proposed Arrangement and alternatives to the Arrangement,
including the potential for a more favourable transaction with a third party and the prospect of proceeding independently to pursue the
Company’s current business plan, and having consulted with its financial and legal advisors, and having considered, among other
things, the Scotiabank Fairness Opinion, the Special Committee unanimously determined that the Arrangement is fair and reasonable to the
Company Shareholders, and the Arrangement and entering into the Arrangement
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Agreement are in the best interests of
the Company. As such, the Special Committee unanimously recommended that the Board approve the Arrangement Agreement.
| 20. | Based on its considerations, investigations and deliberations, including, among other things, consultation
with its financial and legal advisors, the unanimous recommendation of the Special Committee, the Cormark Fairness Opinion and Raymond
James Fairness Opinion, the Board has unanimously determined that the Arrangement is in the best interests of the Company. Accordingly,
the Board unanimously approved the Arrangement and the entering into of the Arrangement Agreement. |
| 21. | In forming its recommendation, the Special Committee and the Board considered a number of factors, including,
without limitation, the factors listed below. The Board based its recommendation upon the totality of the information presented to and
considered by it in light of the knowledge of the Board members of the business, financial condition and prospects of the Company and
after taking into account the Fairness Opinions and the advice of the Company’s legal and other advisors and the advice and input
of management of the Company. |
| (a) | Significant Premium: The Consideration represents an implied value of US$11.34 per Company Share,
being an 18% premium based on the 20-day volume-weighted average prices of the Coeur Shares and Company Shares, each as at October 3,
2024 on the NYSE and NYSE American, respectively, and a 22% premium to the October 3, 2024 closing price of Company Shares on the NYSE
American, being the last trading day prior to the announcement of the Arrangement. This also represents an all-time high in the value
of Company Shares for Company Shareholders. |
| (b) | Meaningful Exposure to Diverse Asset Portfolio: Current Company Shareholders will maintain exposure
to the Company’s high-grade, low-cost and high-margin Las Chispas Operation and will gain exposure to Coeur’s high quality
and diversified portfolio consisting of four robust operating mines in U.S. and Mexico and an exploration property in Canada, with further
potential upside from the district-scale exploration potential of the Combined Company and organic mineral reserve growth. Current Company
Shareholders will hold approximately 37% of the issued and outstanding shares of the Combined Company upon completion of the Arrangement,
based on the number of securities of Coeur and SilverCrest issued and outstanding as of October 3, 2024. |
| (c) | Creation of a Leading Global Silver Company: The addition of Las Chispas to Coeur’s growing
silver production from its recently expanded Rochester mine in Nevada and its Palmarejo underground mine in northern Mexico has the potential
to generate significant 2025 silver production of approximately 21 million ounces from five North American operations, with approximately
56% of revenue generated from U.S.-based mines and approximately 40% of revenue from silver.
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In addition to the significant silver production,
it is anticipated that the Combined Company can produce approximately 432,000 ounces of gold in 2025.
| (d) | Strong Cash Flow and Deleveraging of Combined Company:
The Combined Company is expected to generate approximately US$700 million of EBITDA and US$350 million of free cash flow in 2025 at lower
overall costs and higher overall margins for Coeur. The Combined Company will also have more robust cash flow with the benefit of multiple
producing mines in a diversified portfolio. The strong cash flow profile of the Combined Company will be augmented by SilverCrest’s
strong balance sheet and no debt which are expected to result in an immediate 40% reduction in the Combined Company’s leverage ratio
upon closing of the Arrangement. |
| (e) | Strategic Review Process and Value Maximization: The Arrangement with Coeur is the culmination
of a comprehensive strategic review process that was initiated following Las Chispas achieving commercial production in late 2022, which
process was overseen by the Board initially, and subsequently, the Special Committee, with the assistance of the Company’s financial
advisors (including Raymond James initially in late 2022 and the addition of Cormark in 2024). During this process, the Company, through
its financial advisors, canvassed numerous other potential parties to determine market interest in a transaction involving, and explore
various strategic opportunities available to, SilverCrest (including maintaining status quo, asset purchases, merger of equals, acquisitions
and a sale of the Company). This process resulted in the evaluation of over 25 potential strategic opportunities, the execution of more
than 15 confidentiality agreements, substantive reviews and site visits of more than 10 mineral properties and multiple site visits hosted
at Las Chispas. After consultation on the proposed Arrangement with legal and financial advisors, and after review of the current and
prospective business climate in the precious metals mining industry and other strategic opportunities reasonably available to SilverCrest,
including continuing as an independent entity, potential acquisitions and sales, in each case taking into account the potential benefits,
risks and uncertainties associated with those other opportunities, the Special Committee and the Board believe the Arrangement represents
SilverCrest’s best prospect for maximizing Company Shareholder value. |
| (f) | Asset Diversification and Elimination of Single Asset Risk: The business, operations, assets, financial
condition, operating results and prospects of SilverCrest are subject to significant uncertainty, including, but not limited to, risks
associated with SilverCrest’s dependency on the Las Chispas Operation for its future operating revenue, permitting and regulatory
approvals, exploration and development risks and commodity price and inflation risks. The Combined Company will be better positioned to
pursue a growth and value maximizing strategy as compared with SilverCrest on a standalone basis, as a result of the Combined Company’s
larger market capitalization, asset and geographical
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diversification, elimination of singe asset
risk, technical expertise, greater trading liquidity, enhanced access to capital over the long term and the likelihood of increased investor
interest and access to business development opportunities due to the Combined Company’s larger market presence.
| (g) | Proven Leadership Team: Following the Arrangement, two of the current directors of SilverCrest
will join the board of the Combined Company. Management of the Combined Company will feature proven and experienced mining and business
leaders at both the board and executive management levels, along with diverse, high performing teams at the regional and operating sites
with a proven track record of maximizing value by delivering long-life and profitable silver and gold mining operations. The Combined
Company will continue its commitment to ESG with a specific focus on water usage, emissions, community and workforce development, and
leading governance practices. |
| (h) | Fairness Opinions: The Special Committee received a fairness opinion from Scotiabank, and the Board
received a fairness opinion from each of Cormark and Raymond James, all dated October 3, 2024 to the effect that the Consideration to
be received by the Company Shareholders pursuant to the Arrangement is fair, from a financial point of view, to the Shareholders, based
upon and subject to various assumptions, limitations and qualifications set forth, respectively, in each such opinion. |
| (i) | Support of Directors and Officers: The boards of directors of both SilverCrest and Coeur have unanimously
recommended support for the Arrangement. Additionally, the directors and senior officers of SilverCrest and Coeur have entered into voting
and support agreements pursuant to which they have agreed, among other things, to vote in favour of the Arrangement Resolution at the
Meeting and in favour of the amendment of Coeur’s charter and issuance of Coeur Shares as consideration under the Arrangement at
Coeur’s stockholder meeting, as applicable. |
| (j) | Negotiated Transaction: The Arrangement Agreement is the result of a comprehensive negotiation
process with respect to the key elements of the Arrangement Agreement and Plan of Arrangement, which includes terms and conditions that
are reasonable in the judgment of the Special Committee and the Board. |
| (k) | Other Factors: The Special Committee and the Board also carefully considered the Arrangement with
reference to current economics, industry and market trends affecting each of SilverCrest and Coeur in the precious metals mining industry,
information concerning mineral reserves and mineral resources, business, operations, properties, assets, financial condition, operating
results and prospects of each of SilverCrest and Coeur, taking into account the results of SilverCrest’s due diligence review of
Coeur and its properties. |
| 22. | In making its determinations and recommendations, the Special Committee and the Board also observed that
a number of procedural and legal safeguards were in place and are present to protect the interests of the Company, the Securityholders
and other SilverCrest stakeholders. The procedural and legal safeguards include, among others: |
| (a) | Ability to Respond to Unsolicited Superior Proposals: Subject to the terms of the Arrangement Agreement,
the Board will remain able to respond to any unsolicited bona fide written proposal that, having regard to all of its terms and
conditions, if consummated in accordance with its terms, constitutes or would reasonably be expected to constitute or result in a Company
Superior Proposal (as such term is defined in the Arrangement Agreement), provided that the Company has not materially breached its non-solicitation
covenants under the Arrangement Agreement. |
| (b) | Reasonable Break Fee: The amount of the Company Termination Payment, being $60 million, payable
under certain circumstances, is within the range of termination fees that are considered reasonable for a transaction of the nature and
size of the Arrangement and should not, in the view of the Board, preclude a third party from potentially making a Company Superior Proposal. |
| (c) | Fairness of the Conditions: The Arrangement Agreement provides for certain conditions with respect
to completion of the Arrangement, which conditions are not unduly onerous or outside market practice and could reasonably be expected
to be satisfied in the judgment of the Special Committee and the Board. |
| (d) | Securityholder Approval: The Arrangement Resolution must be approved by at least (i) 66 2/3% of
the votes cast on such resolution by Company Shareholders present in person or represented by proxy and entitled to vote at the Meeting,
(ii) 66 2/3% of the votes cast on such resolution by Company Securityholders, voting together as a single class, present in person or
represented by proxy and entitled to vote at the Meeting, and (iii) a simple majority of the votes cast on such resolution by Company
Shareholders present in person or represented by proxy and entitled to vote at the Meeting, excluding the Excluded Shares for the purposes
of MI 61-101 . |
| (e) | Court and Regulatory Approvals: The Plan of Arrangement must be approved by the Court, which will
consider, among other things, the substantive and procedural fairness and reasonableness of the Plan of Arrangement to Company Shareholders.
The Arrangement Agreement also contains a condition precedent that all regulatory approvals shall be obtained prior to closing. |
| (f) | Dissent Rights. As set out below, the terms of the Plan of Arrangement provide that registered
Company Shareholders as at the close of business on the Record Date who oppose the Arrangement may, upon compliance with certain conditions,
|
exercise dissent rights and, if ultimately
successful, receive fair value for their Company Shares.
| 23. | The Board and the Special Committee also considered a number of potential issues and risks related to
the Arrangement and the Arrangement Agreement, including, among others: |
| (a) | the risks to SilverCrest and the Company Securityholders if the Arrangement is not completed, including
the costs to the Company in pursuing the Arrangement and the diversion of the Company’s management from the conduct of SilverCrest’s
business in the ordinary course; |
| (b) | the terms of the Arrangement Agreement in respect of restricting the Company from soliciting third parties
to make an Acquisition Proposal (as such term is defined in the Arrangement Agreement) and the specific requirements regarding what constitutes
a Company Superior Proposal; |
| (c) | the terms of the Arrangement Agreement that require the Company to conduct its business in the ordinary
course and prevent the Company from taking certain specified actions, which may delay or prevent SilverCrest from taking certain actions
to advance its business pending consummation of the Arrangement; |
| (d) | the fact that, following the Arrangement, SilverCrest will no longer exist as an independent public company
and the Company Shares will be delisted from the TSX and NYSE American; |
| (e) | the risk that changes in Law or regulation could adversely impact the expected benefits of the Arrangement
to SilverCrest, Company Securityholders, and other stakeholders; |
| (f) | the risk that the Coeur Shares to be issued as consideration are based on a fixed Exchange Ratio and will
not be adjusted based on fluctuations in the market value of Company Shares or Coeur Shares; |
| (g) | the risk that regulatory approvals may not be obtained in a timely manner and extend the restrictions
on the conduct of SilverCrest’s business prior to the completion of the Arrangement, which could impact the Company’s ability
to engage in business opportunities that may arise pending completion of the Arrangement; |
| (h) | the Company Termination Payment payable to Coeur, including if SilverCrest enters into an agreement in
respect of a Company Superior Proposal to acquire SilverCrest, or that SilverCrest could be required to pay the Expense Reimbursement; |
| (i) | the conditions to Coeur’s obligations to complete the Arrangement; |
| (j) | the right of Coeur to terminate the Arrangement Agreement under certain circumstances; |
| (k) | the risks inherent in integrating the operations of SilverCrest into Coeur, including that expected synergies
may not be realized, and that successful integration will require the dedication of significant management resources, which will temporarily
detract attention from the day-to-day businesses of the Combined Company; and |
| (l) | the shares of the Combined Company to be received by Company Shareholders upon completion of the Arrangement
will have different rights from Company Shares. |
No Compromise of Debt
| 24. | The Arrangement does not contemplate a compromise of any debt or any debt instruments of the Company and
no creditor of the Company will be materially affected by the Arrangement. |
Dissent Rights
| 25. | The Plan of Arrangement provides registered Company Shareholders with the right to dissent in respect
of the special resolution to approve the Arrangement. |
| 26. | Any registered Company Shareholders who dissent from the Arrangement Resolution in accordance with sections
237 to 247 of the BCBCA, as modified by the Plan of Arrangement, the Interim Order and the Final Order, will be entitled to be paid by
the Company the fair value of the Company Shares held by such Company Shareholders determined as at the close of business on the Business
Day immediately preceding the date on which the Arrangement Resolution is approved by the Company Shareholders. The Dissent Rights with
respect to the Arrangement must be strictly complied with in order for registered Company Shareholders to receive cash representing the
fair value of Company Shares held. |
Interest of Certain Persons
| 27. | To the knowledge of the directors and executive officers of the Company, as of the Record Date, there
are no persons who beneficially own, directly or indirectly, or exercise control or direction over, Company Shares carrying 10% or more
of the voting rights of Company Shareholders at the Meeting, or Company Shares and Company Options that collectively will carry 10% or
more of the voting rights of Company Securityholders at the Meeting. |
United States Securities Laws
| 28. | Section 3(a)(10) of the United States Securities Act of 1933, as amended (the “US Securities
Act”), provides an exemption from the registration requirements thereof for the issue of securities in exchange for other outstanding
securities where the terms and conditions of the issue and exchange are approved by a court of competent jurisdiction
|
after a hearing upon the fairness of such
terms and conditions at which all persons to whom it is proposed to issue such securities shall have the right to appear.
| 29. | In order to ensure that the issuance of securities by the Company pursuant to the Arrangement will be
exempt from the registration requirements of the US Securities Act pursuant to Section 3(a)(10) of the US Securities Act, it is necessary
that, among other things: |
| (a) | prior to the hearing required to approve the Arrangement, the Court is advised of the intention of the
parties to rely on Section 3(a)(10) of the US Securities Act based on the Court’s approval of the Arrangement; |
| (b) | the Interim Order of the Court approving the Meeting specifies that each Company Securityholder entitled
to vote at the Meeting as well as holders of Company DSUs, Company RSUs, and Company PSUs will have the right to appear before the Court
at the hearing to consider approval of the Arrangement and the Final Order, so long as such person files a Response to Petition within
a reasonable time; |
| (c) | the Company Securityholders will be given adequate notice advising them of their rights to attend such
hearing and provided with sufficient information necessary for them to exercise that right; |
| (d) | the Court is required to satisfy itself as to the fairness of the Arrangement to the Company Securityholders; |
| (e) | the Court has determined, prior to approving the Final Order, that the terms and conditions of the exchanges
of securities contemplated by the Arrangement are substantively and procedurally fair to the Company Securityholders; and |
| (f) | the order of the Court approving the Arrangement expressly states that the Arrangement is approved by
the Court as being substantively and procedurally fair and reasonable to the Company Securityholders. |
| 30. | The Company Securityholders to whom securities will be issued under the Arrangement shall receive such
securities in reliance on the exemption from the registration requirements of the US Securities Act contained in Section 3(a)(10) thereof
based on the Court’s approval of the Arrangement. |
Fairness of the Arrangement
| 31. | SilverCrest will rely on this Court’s approval and declaration of fairness of the Arrangement, including
the terms and conditions thereof and the issuance and exchanges of securities contemplated therein to the Company Securityholders, after
a hearing upon such matters at which the Company Securityholders shall have the right to appear, to form the basis of an exemption from
the registration requirements of the US Securities Act
|
pursuant to section 3(a)(10) thereof,
for the issuance and exchange of securities in connection with the Arrangement.
PART 3: LEGAL BASIS
| 32. | Sections 288-291 of the BCBCA, as amended; |
| 33. | Supreme Court Civil Rules 2-1(2)(b); 4-4, 4-5, 8-1 and 16-1; and |
| 34. | The inherent jurisdiction of this Honourable Court. |
PART 4: MATERIAL TO BE RELIED ON
| 35. | The Affidavit #1 of Anna Ladd-Kruger affirmed January 6, 2025. |
| 36. | Such further affidavits and other documents as counsel for the Company may advise. |
The petitioner estimates that the hearing
of the petition will take 20 minutes.
| Dated: |
January 6, 2025 |
|
/s/ Rajit Mittal |
| |
|
Signature of lawyer for the Petitioner
Rajit Mittal |
|
To be completed by the court only:
Order made
☐ in
the terms requested in paragraphs _______________ of Part 1 of this notice of this petition
☐ with
the following variations and additional terms:
Date: ________________________
_____________________________________
Signature of ☐
Judge ☐ Master |
Schedule “A”
INTERIM ORDER
No. ____________
Vancouver Registry
IN THE SUPREME COURT OF BRITISH COLUMBIA
IN THE MATTER OF SECTION 288 OF THE BUSINESS
CORPORATIONS ACT,
S.B.C. 2002, CHAPTER 57, AS AMENDED
AND
IN THE MATTER OF A PROPOSED ARRANGEMENT INVOLVING
SILVERCREST METALS INC., ITS SECURITYHOLDERS, COMPAÑÍA MINERA LA
LLAMARADA, S.A. DE C.V., NORCREST METALS INC., COEUR MINING, INC., COEUR
ROCHESTER, INC., AND 1504648 B.C. UNLIMITED LIABILITY COMPANY
SILVERCREST METALS INC.
PETITIONER
ORDER MADE AFTER APPLICATION
(Interim Order)
| BEFORE |
)
)
) |
ASSOCIATE JUDGE |
)
)
) |
January 8, 2025 |
ON THE APPLICATION of the Petitioner, SilverCrest
Metals Inc. (“SilverCrest”) for an Interim Order pursuant to section 291 of the Business Corporations Act, S.B.C.
2002, c. 57, as amended (the “BCBCA”) in connection with a proposed arrangement (the “Arrangement”)
involving SilverCrest, its securityholders, Compañía Minera La Llamarada, S.A. DE C.V., NorCrest Metals Inc., Coeur Mining,
Inc. (“Coeur”), Coeur Rochester, Inc., and 1504648 B.C. Unlimited Liability Company, to be effected on the terms and
subject to the conditions set out in a plan of arrangement (the “Plan of Arrangement”), without notice, coming on for
hearing at 800 Smithe Street, Vancouver BC on January 8, 2025 and ON HEARING Rajit Mittal, counsel for the Petitioner, and Tom Friedland
and Laura Bevan for Coeur, and upon reading the Petition to the Court herein and the Affidavit #1 of Anna Ladd-Kruger affirmed January
6, 2025 and filed herein (the “Ladd-Kruger Affidavit”); and UPON BEING ADVISED that it is the intention of the parties
to rely upon Section 3(a)(10) of the United States Securities Act of 1933, as amended
(the “US Securities Act”), as the basis for an exemption from the registration requirements of the US Securities Act
pursuant to section 3(a)(10) thereof, for the issuance of securities in connection with the Arrangement;
THIS COURT ORDERS THAT:
DEFINITIONS
| 1. | As used in this Interim Order, unless otherwise defined, terms beginning with capital letters have the
respective meanings set out in the draft combined notice of meeting and management information circular (collectively, the “Circular”)
attached as Exhibit “A” to the Ladd-Kruger Affidavit. |
MEETING
| 2. | Pursuant to Sections 186 and 288-291 of the BCBCA, SilverCrest is authorized and directed to call, hold
and conduct a special meeting (the “Meeting”) of the holders (“Company Shareholders”) of common
shares (“Company Shares”) in the capital of SilverCrest, and the holders of options to purchase Company Shares (“Company
Options”) (holders of Company Options together with Company Shareholders, collectively, “Company Securityholders”)
to be held at Suite 2200, RBC Place, 885 West Georgia Street, Vancouver, British Columbia on February 6, 2025 at 10:00 a.m. (Vancouver
Time), or such other date as SilverCrest and Coeur may agree, to, among other things: |
| (a) | consider and, if deemed acceptable, to pass, with or without variation, a special resolution (the “Arrangement
Resolution”) of the Company Securityholders approving the Arrangement under Division 5 of Part 9 of the BCBCA, the full text
of which is set forth in Appendix “A” to the Circular; and |
| (b) | transact such further or other business, including amendments to the foregoing, as may properly be brought
before the Meeting or any adjournments or postponements thereof. |
| 3. | The Meeting shall be called, held and conducted in accordance with the BCBCA, the notice of articles and
articles of SilverCrest, and the Circular, subject to the terms of this Interim Order, and any further order of this Court, and the rulings
and directions of the chair of the Meeting, such rulings and directions not to be inconsistent with this Interim Order. |
ADJOURNMENT
| 4. | Notwithstanding the provisions of the BCBCA and the notice of articles and articles of SilverCrest, and
subject to the terms of the Arrangement Agreement, SilverCrest, if it deems advisable, is specifically authorized to adjourn, postpone
or cancel the Meeting or the date of the application for the Final Order (defined at paragraph 32 of this Interim Order) on one or more
occasions, without the necessity of first convening the Meeting or first obtaining any vote of the Company Securityholders respecting
such adjournment or postponement and without the need for approval of the Court. Subject to the terms of the Arrangement Agreement, notice
of any such cancellation, adjournments or postponements shall be given by news release, newspaper advertisement, or by notice sent to
the Company Securityholders by one of the methods specified in paragraph 9 of this Interim Order, as determined to be the most appropriate
method of communication by the board of directors of SilverCrest. |
| 5. | The Record Date (as defined in paragraph 7 below) shall not change in respect of any adjournments or postponements
of the Meeting unless required by this Court or by law. |
AMENDMENTS
| 6. | Prior to the Meeting, SilverCrest is authorized to make, in the manner contemplated by and subject to
the Arrangement Agreement, such amendments, modifications, revisions or supplements to the proposed Arrangement, the Plan of Arrangement,
the Arrangement Agreement and the Circular, without any additional notice to the Company Securityholders |
or further orders of this Court, and the
Arrangement, Plan of Arrangement, Arrangement Agreement, and Circular as so amended, modified, revised or supplemented shall be the Arrangement,
Plan of Arrangement, the Arrangement Agreement or the Circular, respectively, to be submitted to the Company Securityholders for the Meeting
and, as applicable, subject to the Arrangement Resolution.
RECORD DATE
| 7. | The record date for determining the Company Securityholders entitled to receive notice of, attend at and
vote at the Meeting shall be the close of business in Vancouver, British Columbia on December 19, 2024 (the “Record Date”). |
NOTICE OF MEETING
| 8. | The Circular is hereby deemed to represent sufficient and adequate disclosure, including for the purpose
of Section 290(1)(a) of the BCBCA, and SilverCrest shall not be required to send to the Company Securityholders any other or additional
statement pursuant to Section 290(1)(a) of the BCBCA. |
| 9. | The Circular and the Notice of Hearing of Petition, in substantially the same forms as contained in Exhibits
“A” and “B” to the Ladd-Kruger Affidavit (collectively referred to as the “Notice Materials”),
and in the case of the Company Securityholders, the forms of proxy, voting instruction form, and letter of transmittal, in substantially
the same forms as contained in Exhibit “C” to the Ladd-Kruger Affidavit (together with the Notice Materials, the “Meeting
Materials”), with such deletions, amendments or additions thereto as counsel for SilverCrest may advise are necessary or desirable,
provided that such deletions, amendments or additions are not inconsistent with the terms of this Interim Order, shall be sent to: |
| (a) | the registered Company Shareholders as they appear on the central securities register of SilverCrest or,
in respect of holders of Company Options, the applicable records of SilverCrest or its registrar and transfer agent, as the case may be,
in each case, as at the close of business on the Record Date at least 21 days prior to the date of the Meeting, by one or more of the
following methods: |
| (i) | by prepaid ordinary or air mail addressed to the registered Company Securityholders at their addresses
as they appear in the applicable records of SilverCrest or its registrar and transfer agent, as at the Record Date; |
| (ii) | by delivery in person or by courier to the addresses specified in subparagraph (i) above; or |
| (iii) | by email or facsimile transmission to any registered Company Securityholders, who has previously identified
himself, herself or itself to the satisfaction of SilverCrest, acting through its representatives, and who requests such email or facsimile
transmission; and |
| (b) | the non-registered Company Shareholders by providing, in accordance with National Instrument 54-101 —
Communications with Beneficial Owners of Securities of a Reporting Issuer of the Canadian Securities Administrators (“NI
54-101”), the requisite number of copies of the Meeting Materials to intermediaries |
and registered nominees to facilitate the
distribution of the Meeting Materials to the beneficial owners of Company Shares in accordance with NI 54-101;
| (c) | the directors and auditors of SilverCrest by prepaid ordinary mail or by delivery in person or by courier,
or by email or facsimile transmission, to such persons at least 21 days prior to the date of the Meeting; |
and substantial compliance with this paragraph
shall constitute good and sufficient notice of the Meeting and delivery of the Meeting Materials.
| 10. | The Notice Materials shall be sent by prepaid ordinary mail or by delivery in person or by courier, or
by email transmission to the holders of deferred share units to purchase Company Shares, the holders of restricted share units to purchase
Company Shares, and the holders of performance share units to purchase Company Shares (collectively, “Company Incentive Unit
Holders”), to the address of such holder as it appears in the applicable records of SilverCrest at least 21 days prior to the
date of the Meeting. |
| 11. | Accidental failure of or omission by SilverCrest to give notice to any one or more persons entitled thereto,
or the non-receipt of such notice by one or more persons entitled thereto, or any failure or omission to give such notice as a result
of events beyond the reasonable control of SilverCrest (including, without limitation, any inability to use postal services), shall not
constitute a breach of this Interim Order or a defect in the calling of the Meeting, and shall not invalidate any resolution passed or
proceeding taken at the Meeting, but if any such failure or omission is brought to the attention of SilverCrest, then it shall use reasonable
best efforts to rectify it by the method and in the time most reasonably practicable in the circumstances. |
| 12. | Provided that notice of the Meeting is given, the Meeting Materials are made available to Company Securityholders,
and in each case to other persons entitled to be provided such materials in compliance with this Interim Order, the requirement of Section
290(1)(b) of the BCBCA to include certain disclosure in any advertisement of the Meeting is waived and no other form of service of the
Meeting Materials or any portion thereof need be made or notice given, or other material served in respect of these proceedings or the
Meeting, except to the extent required by paragraph 9 above or as may be directed by a further order of this Court. |
DEEMED RECEIPT OF NOTICE
| 13. | The Notice Materials and Meeting Materials (and any amendments, modifications, updates or supplements
to the Notice Materials or Meeting Materials and any notice of adjournment or postponement of the Meeting) shall be deemed, for the purposes
of this Interim Order, to have been served upon and received: |
| (a) | in the case of mailing pursuant to paragraphs 9(a)(i), 9(c), and 10 above, the day, Saturdays, Sundays
and holidays excepted, following the date of mailing; |
| (b) | in the case of delivery in person pursuant to paragraph 9(a)(ii) above, the day following personal delivery
or, in the case of delivery by courier, the day following delivery to the person’s address in paragraph 9 above; |
| (c) | in the case of any means of transmitted, recorded or electronic communication pursuant to paragraphs 9(a)(iii),
9(c), and 10 above, when dispatched or delivered for dispatch; and |
| (d) | in the case of delivery to clearing agencies or intermediaries for onward distribution pursuant to paragraph
9(b) above, the day following delivery to clearing agencies or intermediaries. |
UPDATING MEETING MATERIALS
| 14. | Notice of any amendments, modifications, updates or supplements to any of the information provided in
the Meeting Materials may be communicated, at any time prior to the Meeting, to the Company Securityholders by press release, news release,
newspaper advertisement or by notice sent to the Company Securityholders by any of the means set forth in paragraph 9, as determined to
be the most appropriate method of communication by the board of directors of SilverCrest. |
QUORUM AND VOTING
| 15. | The quorum required at the Meeting shall be two (2) persons, present in person or by proxy, being Company
Shareholders entitled to vote at the Meeting, and who hold at least five percent (5%) of the issued and outstanding Company Shares entitled
to vote at the Meeting. |
| 16. | Each registered Company Securityholder whose name appears on the register of holders of Company Shares
or Company Options as the case may be, in each case, as of the close of business in Vancouver, British Columbia, on the Record Date, is
entitled to one vote for each Company Share or Company Option, as applicable. |
| 17. | The vote required to pass the Arrangement Resolution shall be the affirmative vote of at least: (i) two-thirds
(66⅔%) of the votes cast at the Meeting by the Company Shareholders present or represented by proxy at the Meeting; (ii) two-thirds
(66⅔%) of the votes cast at the Meeting by Company Securityholders, collectively voting as a single class, present or represented
by proxy at the Meeting; and (iii) a simple majority of the votes cast by the Company Shareholders present or represented by proxy
at the Meeting, excluding the Company Shares required to be excluded in accordance with Multilateral Instrument 61-101 — Protection
of Minority Security Holders in Special Transactions. |
CHAIR OF THE MEETING
| 18. | The chair of the Meeting shall be an officer or director of SilverCrest or such other person as may be
appointed for that purpose. |
| 19. | The chair of the Meeting is at liberty to call on the assistance of legal counsel of SilverCrest at any
time and from time to time, as the chair of the Meeting may deem necessary or appropriate, during the Meeting. |
| 20. | The chair of the Meeting shall be permitted to ask questions of, and demand the production of evidence,
from the Company Securityholders or such other persons in attendance or represented at the Meeting, as he, she, they or it considers appropriate
having regard to the orderly conduct of the Meeting, the authority of any person to vote at the Meeting, and |
the validity and propriety of the votes
cast and the proxies submitted in respect of the Arrangement Resolution.
| 21. | The chair or another representative of SilverCrest present at the Meeting shall, in due course after the
Meeting, file with the Court an affidavit verifying the actions taken and the decisions reached at the Meeting with respect to the Arrangement. |
PERMITTED ATTENDEES
| 22. | The only persons entitled to attend the Meeting shall be (i) the registered Company Securityholders as
of the close of business in Vancouver, British Columbia on the Record Date, or their respective proxyholders, (ii) SilverCrest’s
directors, officers, auditors and advisors, (iii) representatives of SilverCrest and Coeur, including any of their respective directors,
officers and advisors, and (iv) any other person admitted on the invitation of the chair of the Meeting or with the consent of the chair
of the Meeting, and the only persons entitled to be represented and to vote at the Meeting shall be the registered Company Securityholders
as at the close of business in Vancouver, British Columbia, on the Record Date, or their respective proxyholders. |
SCRUTINEERS
| 23. | Representatives of SilverCrest’s registrar and transfer agent (or any agent thereof) are authorized
to act as scrutineers for the Meeting. |
SOLICITATION OF PROXIES
| 24. | SilverCrest is authorized to use the forms of proxy (in substantially the same forms as attached as Exhibit
“C” to the Ladd-Kruger Affidavit) in connection with the Meeting, subject to SilverCrest’s ability to insert dates and
other relevant information in the final forms thereof, as well as a voting instruction form for non-registered Company Shareholders and,
subject to the Arrangement Agreement, with such amendments, revisions or supplemental information as SilverCrest may determine are necessary
or desirable. SilverCrest is authorized, at its expense, to solicit proxies, directly and through its officers, directors and employees,
and through such agents or representatives as it may retain for the purpose, and by mail, telephone or such other forms of personal or
electronic communication as it may determine. |
| 25. | The procedure for the use of proxies at the Meeting shall be as set out in the Meeting Materials. The
chair of the Meeting may, in his, her, or their discretion, without notice, waive or extend the time limits for the deposit of proxies
by the Company’s Securityholders if he or she deems it advisable to do so, such waiver or extension to be endorsed on the proxy
by the initials of the chair of the Meeting. |
DISSENT RIGHTS
| 26. | Each registered Company Shareholder who is a registered Company Shareholder as of the Record Date shall,
as set out in the Plan of Arrangement, be entitled to exercise dissent rights (“Dissent Rights”) in respect of the
Arrangement Resolution under Division 2 of Part 8 of the BCBCA, as modified by the Plan of Arrangement, this Interim Order, and the Final
Order. |
| 27. | Registered Company Shareholders shall be the only Company Shareholders entitled to exercise Dissent Rights.
A beneficial holder of Company Shares registered in the name of a broker, custodian, trustee, nominee or other intermediary who wishes
to dissent must make arrangements for the registered Company Shareholder to dissent on behalf of the beneficial holder of Company Shares
or, alternatively, make arrangements to become a registered Company Shareholder. |
| 28. | In order for a registered Company Shareholder to exercise Dissent Rights: |
| (a) | a dissenting registered Company Shareholder must deliver written notice of dissent (a “Notice
of Dissent”) to SilverCrest c/o Cassels, Brock & Blackwell LLP, Suite 2200, RBC Place, 885 West Georgia Street, Vancouver,
BC V6C 3E8 Canada, Attention: Rajit Mittal Canada by 4:00 p.m. (Vancouver time) on or before February 4, 2025, or by 4:00 p.m. (Vancouver
time) on the Business Day that is two Business Days immediately preceding the Meeting if it is not held on February 6, 2025, and such
Notice of Dissent must strictly comply with the requirements of section 242 of the BCBCA; |
| (b) | a dissenting registered Company Shareholder must not have voted his, her, their, or its Company Shares
at the Meeting, either by proxy or in person, in favour of the Arrangement Resolution, and a vote against the Arrangement Resolution or
an abstention shall not constitute written Notice of Dissent; |
| (c) | a dissenting registered Company Shareholder may not exercise Dissent Rights in respect of only a portion
of such dissenting registered Company Shareholder’s Company Shares, but may dissent only with respect to all the Company Shares
held by such person; and |
| (d) | the exercise of such Dissent Right must otherwise comply with the requirements of Sections 237 to 247
of the BCBCA, as modified by the Plan of Arrangement, this Interim Order, and the Final Order. |
| 29. | Any registered Company Shareholder who duly exercises Dissent Rights and who: |
| (a) | is ultimately determined by this Court to be entitled to be paid fair value for his, her, their, or its
Company Shares shall be deemed to have transferred those Company Shares as of the Effective Time (as defined in the Circular), without
any further act or formality and free and clear of all liens, claims, encumbrances, charges, adverse interests or security interests to
SilverCrest for cancellation in consideration for a payment of cash from SilverCrest equal to such fair value; or |
| (b) | is for any reason ultimately determined by this Court not to be entitled to be paid fair value for his,
her or its Company Shares pursuant to the exercise of the Dissent Rights, shall be deemed to have participated in the Arrangement on the
same basis and at the same time as any non-dissenting Company Shareholder; |
but in no case shall SilverCrest or Coeur
or any other person be required to recognize such Company Shareholders as holders of Company Shares at or after the date upon which the
Arrangement becomes effective and the names of such Company Shareholders shall be deleted from SilverCrest’s register of holders
of Company Shares at that time.
| 30. | Notice to the registered Company Shareholders of their Dissent Rights with respect to the Arrangement
Resolution shall be given by including information with respect to the Dissent Rights in the Circular to be sent to registered Company
Shareholders in accordance with this Interim Order. |
| 31. | Subject to further order of this Court, the rights available to the registered Company Shareholders under
the BCBCA and the Plan of Arrangement to dissent from the Arrangement will constitute full and sufficient Dissent Rights for the registered
Company Shareholders with respect to the Arrangement. |
APPLICATION FOR FINAL ORDER
| 32. | Upon the approval, with or without variation, by the Company Securityholders of the Arrangement Resolution,
in the manner set forth in this Interim Order, SilverCrest may apply to this Court for, inter alia, an order: |
| (a) | pursuant to s. 291(4)(a) of the BCBCA, approving the Arrangement; and |
| (b) | pursuant to s. 291(4)(c) of the BCBCA, declaring that the terms and conditions of the Arrangement, and
the distribution of securities to be effected by the Arrangement, are procedurally and substantively fair and reasonable |
(collectively, the “Final Order”),
and the hearing of the Final Order shall
be held in person at the Courthouse at 800 Smithe Street, Vancouver, British Columbia at 9:45 a.m. (Vancouver time) on February 11, 2025,
or as soon thereafter as the hearing of the Final Order can be heard, or at such other date and time as this Court may direct.
| 33. | The form of Notice of Hearing of Petition in connection with the Final Order attached to the Ladd-Kruger
Affidavit as Exhibit “B” is hereby approved as the form of Notice of Proceedings for such approval. Any Company Securityholder
or Company Incentive Unit Holder has the right to appear (either in person or by counsel) and make submissions at the hearing of the application
for the Final Order, subject to the terms of this Interim Order. |
| 34. | Any Company Securityholder or Company Incentive Unit Holder seeking to appear at the hearing of the application
for the Final Order must file and deliver a Response to Petition (a “Response”) in the form prescribed by the Supreme
Court Civil Rules, and a copy of all affidavits or other materials upon which they intend to rely, to the Petitioner’s solicitors
at: |
CASSELS, BROCK & BLACKWELL LLP
Barristers and Solicitors
2200 - 885 West Georgia St.
Vancouver, British Columbia, Canada V6C 3E8
Attention: Rajit Mittal
Fax number for delivery: (604) 691-6120
Telephone: (778) 309-7940
by or before 4:00 p.m. (Vancouver time)
on the date that is two Business Days prior to the date of the hearing of the application for the Final Order.
| 35. | Sending the Notice of Hearing of Petition in connection with the Final Order and this Interim Order in
accordance with paragraphs 9 and 10 of this Interim Order shall constitute good and sufficient service of this proceeding and no other
form of service need be made and no other material need be served on persons in respect of these proceedings, except as provided in paragraphs
36 and 37 below. In particular, service of the Petition, the Ladd-Kruger Affidavit, and additional affidavits as may be filed, is dispensed
with. |
| 36. | The only persons entitled to notice of any further proceedings herein, including any hearing to approve
the Arrangement, and to appear and be heard thereon, shall be the solicitors for Coeur and any persons who have delivered a Response in
accordance with this Interim Order. |
| 37. | In the event the hearing for the Final Order is adjourned, only the solicitors for Coeur and those persons
who have filed and delivered a Response in accordance with this Interim Order need be provided with notice of the adjourned hearing date
and any filed materials. |
VARIANCE
| 38. | The Petitioner shall, subject to the terms of the Arrangement Agreement, be entitled, at any time, to
apply to vary this Interim Order or for such further order or orders as may be appropriate. |
| 39. | To the extent of any inconsistency or discrepancy between this Interim Order and the Circular, the BCBCA,
applicable Securities Laws or the notice of articles and articles of SilverCrest, this Interim Order shall govern. |
THE FOLLOWING PARTIES APPROVE THE FORM OF THIS
ORDER AND CONSENT TO EACH OF THE ORDERS, IF ANY, THAT ARE INDICATED ABOVE AS BEING BY CONSENT:
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| Signature of Lawyer for SilverCrest Metals Inc. |
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| Rajit Mittal |
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| Signature of Lawyer for Coeur Mining, Inc. |
|
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| Tom Friedland / Laura Bevan |
|
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By the Court |
| |
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|
Registrar |
No. _____________
Vancouver Registry
IN THE SUPREME COURT OF BRITISH COLUMBIA
IN THE MATTER OF SECTION 288 OF THE BUSINESS
CORPORATIONS ACT, S.B.C. 2002, CHAPTER 57,
AS AMENDED
AND
IN THE MATTER OF A PROPOSED ARRANGEMENT INVOLVING
SILVERCREST METALS INC., ITS SECURITYHOLDERS, COMPAÑÍA MINERA LA
LLAMARADA, S.A. DE C.V., NORCREST METALS INC., COEUR MINING, INC., COEUR
ROCHESTER, INC., AND 1504648 B.C. UNLIMITED LIABILITY COMPANY
SILVERCREST METALS INC.
PETITIONER
ORDER MADE AFTER APPLICATION
(Interim Order)
CASSELS BROCK & BLACKWELL LLP
Lawyers
2200 — 885 West Georgia Street
Vancouver, B.C. V6C 3E8
Telephone: (778) 309-7940
E-mail: rmittal@cassels.com
Attention: Rajit Mittal
Matter# 054862-00008
FILING AGENT: WEST COAST TITLE SEARCH
Schedule “B”
FINAL ORDER
No. [●]
Vancouver Registry
IN THE SUPREME COURT OF BRITISH COLUMBIA
IN THE MATTER OF SECTION 288 OF THE BUSINESS
CORPORATIONS ACT,
S.B.C. 2002, CHAPTER 57, AS AMENDED
AND
IN THE MATTER OF A PROPOSED ARRANGEMENT INVOLVING
SILVERCREST METALS INC., ITS SECURITYHOLDERS, COMPAÑÍA MINERA LA
LLAMARADA, S.A. DE C.V., NORCREST METALS INC., COEUR MINING, INC., COEUR
ROCHESTER, INC., AND 1504648 B.C. UNLIMITED LIABILITY COMPANY
SILVERCREST METALS INC.
PETITIONER
ORDER MADE AFTER APPLICATION
(Final Order)
| BEFORE |
)
)
) |
THE HONOURABLE JUSTICE |
)
)
) |
February [●], 2025 |
ON THE APPLICATION of SilverCrest Metals Inc.
(“SilverCrest”) coming on for hearing at 800 Smithe Street, Vancouver, British Columbia on February [●], 2025
and UPON HEARING Rajit Mittal, counsel for the Petitioner; Tom Friedland and Laura Bevan for Coeur Mining, Inc. (“Coeur”);
and no one appearing on behalf of the holders (“Company Shareholders”) of common shares (“Company Shares”)
in the capital of SilverCrest, the holders of options to purchase Company Shares (“Company Options”) (holders of Company
Options, together with Company Shareholders, collectively, “Company Securityholders”), the holders of deferred share
units to purchase Company Shares (“Company DSUs”), the holders of restricted share units to purchase Company Shares
(“Company RSUs”), and the holders of performance share units to purchase Company Shares (“Company PSUs”)
(holders of Company DSUs, Company RSUs, and Company PSUs, collectively, “Company Incentive Unit Holders”), or any other
person affected; AND UPON READING the Petition to the Court herein dated January 6, 2025; AND UPON READING the Interim Order of Associate
Judge [●] made herein on January 8, 2025; AND UPON READING Affidavit #1 of Anna Ladd-Kruger made on January 6, 2025, Affidavit #2
of Anna Ladd-Kruger made on February [●], 2025; AND UPON IT APPEARING that good and sufficient notice of the time and place of the
hearing of this application was given to the Company Securityholders and Company Incentive Unit Holders in accordance with the Interim
Order; AND UPON the requisite approval of the Company Securityholders having been obtained at the special meeting of SilverCrest held
on February [●], 2025; AND UPON CONSIDERING the fairness to the parties affected by the terms and conditions of the arrangement
(the “Arrangement”) contemplated in the plan of arrangement (the “Plan of Arrangement”), a copy
of which is attached hereto as Schedule “A”, and the transactions contemplated by the Arrangement; AND UPON BEING INFORMED
that it is the intention of the
parties to rely on section 3(a)(10) of the
United States Securities Act of 1933, as amended (the “US Securities Act”),
and that the declaration of the fairness of, and the approval of, the Arrangement by this Court will serve as the basis for an exemption
from the registration requirements of the US Securities Act pursuant to section 3(a)(10) thereof, for the issuance of securities in connection
with the Arrangement;
THIS COURT ORDERS that:
| 1. | Pursuant to the provisions of s. 291(4)(c) of the Business Corporations Act,
S.B.C. 2002, C. 57, as amended (the “BCBCA”) the Arrangement as provided for in the Plan of Arrangement, including
the terms and conditions thereof and the issuances of securities contemplated therein, is substantively and procedurally fair and reasonable
to Company Securityholders; |
| 2. | The Arrangement as provided for in the Plan of Arrangement be and hereby is approved pursuant to the provisions
of s. 291(4)(a) of the BCBCA; and |
| 3. | SilverCrest and Coeur shall be at liberty to seek the advice and direction of this Court as to the implementation
of this Order or to apply for such further order or orders as may be appropriate. |
THE FOLLOWING PARTIES APPROVE THE FORM OF THIS
ORDER AND CONSENT TO EACH OF THE ORDERS, IF ANY, THAT ARE INDICATED ABOVE AS BEING BY CONSENT:
| |
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| Signature of lawyer for the Petitioner |
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| Rajit Mittal |
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| Signature of Lawyer for Coeur Mining, Inc. |
|
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| Tom Friedland / Laura Bevan |
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By the Court |
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Registrar |
SCHEDULE “A”
No. [●]
Vancouver Registry
IN THE SUPREME COURT OF BRITISH COLUMBIA
IN THE MATTER OF SECTION 288 OF THE BUSINESS
CORPORATIONS ACT, S.B.C. 2002, CHAPTER 57,
AS AMENDED
AND
IN THE MATTER OF A PROPOSED ARRANGEMENT INVOLVING
SILVERCREST METALS INC., ITS SECURITYHOLDERS, COMPAÑÍA MINERA LA
LLAMARADA, S.A. DE C.V., NORCREST METALS INC., COEUR MINING, INC., COEUR
ROCHESTER, INC., AND 1504648 B.C. UNLIMITED LIABILITY COMPANY
SILVERCREST METALS INC.
PETITIONER
ORDER MADE AFTER APPLICATION
(Final Order)
CASSELS BROCK & BLACKWELL LLP
Lawyers
2200 —
885 West Georgia Street
Vancouver, B.C. V6C 3E8
Telephone: (778) 372-7345
E-mail: rmittal@cassels.com
Attention: Rajit Mittal
Matter# 054862-00008
FILING AGENT: WEST COAST TITLE SEARCH
No. S-250077
Vancouver Registry
IN THE SUPREME COURT OF BRITISH COLUMBIA
IN THE MATTER OF SECTION 288 OF THE BUSINESS
CORPORATIONS ACT,
S.B.C. 2002, CHAPTER 57, AS AMENDED
AND
IN THE MATTER OF A PROPOSED ARRANGEMENT INVOLVING
SILVERCREST METALS INC., ITS SECURITYHOLDERS,
COMPAÑÍA MINERA LA
LLAMARADA, S.A. DE C.V., NORCREST METALS INC.,
COEUR MINING, INC., COEUR
ROCHESTER, INC., AND 1504648 B.C. UNLIMITED LIABILITY
COMPANY
SILVERCREST METALS INC.
PETITIONER
NOTICE OF HEARING OF PETITION
| To: | The holders (“Company Shareholders”) of common shares (the “Company Shares”)
in the capital of SilverCrest, the holders of options (“Company Options”) to purchase Company Shares (holders of Company
Options, together with Company Shareholders, collectively, “Company Securityholders”), the holders of deferred share
units to purchase Company Shares (“Company DSUs”), the holders of restricted share units to purchase Company Shares
(“Company RSUs”), and the holders of performance share units to purchase Company Shares (“Company PSUs”)
(holders of Company DSUs, Company RSUs, and Company PSUs, collectively, “Company Incentive Unit Holders”). |
NOTICE IS HEREBY GIVEN that a Petition to the
Court has been filed by the Petitioner, in the Supreme Court of British Columbia (the “Court”) for approval of a plan
of arrangement (the “Arrangement”) pursuant to the Business Corporations Act, S.B.C. 2002, c.57, as amended
(the “BCBCA”).
AND NOTICE IS FURTHER GIVEN that by an Interim
Order Made After Application pronounced by the Court on January 8, 2025, the Court has given directions as to the calling of a special
meeting of the Company Securityholders (the “Meeting”), for the purpose of, among other things, considering, voting
upon and approving the Arrangement.
AND NOTICE IS FURTHER GIVEN that if the Arrangement
is approved at the Meeting, the Petitioner intends to apply to the Court for a final order approving the Arrangement and for a determination
that the terms of the Arrangement are procedurally and substantively fair and reasonable (the “Final Order”), which
application shall be made before the presiding Judge in Chambers at the Courthouse, 800 Smithe Street, Vancouver, British Columbia, on
February 11, 2025, at 9:45 am (Vancouver time), or as soon thereafter as counsel may be heard or at such other date and time as the Court
may direct (the “Final Application”).
NOTICE IS FURTHER GIVEN that the Court has been
advised that, if granted, the Final Order approving the Arrangement and the declaration that the Arrangement is substantively and procedurally
fair and reasonable to the Company Securityholders will serve as a basis of a claim for the exemption from the registration requirements
of the United States Securities Act of 1933, as amended, set forth in Section 3(a)(10) thereof with respect to the issuance and
exchange of such securities under the proposed Arrangement.
IF YOU WISH TO BE HEARD, any person affected
by the Final Order sought may appear (either in person or by counsel) and make submissions at the Final Application, but only if such
person has filed with the Court at the Court Registry, 800 Smithe Street, Vancouver, British Columbia, a Response to Petition (“Response”)
in the form prescribed by the Supreme Court Civil Rules, and delivered a copy of the filed Response, together with all affidavits
and other material upon which such person intends to rely at the hearing of the Final Application, including an outline of such person’s
proposed submission, to the Petitioner at its address for delivery set out below by or before 4:00 p.m. (Vancouver time) no later than
two business days prior to the date of the hearing of the Final Application.
The Petitioner’s address for delivery is:
CASSELS, BROCK & BLACKWELL LLP
Barristers and Solicitors
2200 - 885 West Georgia St.
Vancouver, British Columbia, Canada V6C 3E8
Attention: Rajit Mittal
IF YOU WISH TO BE NOTIFIED OF ANY ADJOURNMENT
OF THE FINAL APPLICATION, YOU MUST GIVE NOTICE OF YOUR INTENTION by filing and delivering the form of “Response” as aforesaid.
You may obtain a form of “Response” at the Court Registry, 800 Smithe Street, Vancouver, British Columbia, V6Z 2E1.
AT THE HEARING OF THE FINAL APPLICATION, the
Court may approve the Arrangement as presented, or may approve it subject to such terms and conditions as the Court deems fit.
IF YOU DO NOT FILE A RESPONSE and attend, either
in person or by counsel, at the time of such hearing, the Court may approve the Arrangement, as presented, or may approve it subject to
such terms and conditions as the Court shall deem fit, all without any further notice to you. If the Arrangement is approved, it will
significantly affect the rights of the Company Securityholders and Company Incentive Unit Holders.
A copy of the said Petition and other documents
in the proceeding will be furnished to any Company Securityholders or Company Incentive Unit Holders upon request in writing addressed
to the solicitors of the Petitioner at the address for delivery set out above.
Estimated time required: 20 minutes
This matter is not within the jurisdiction of an Associate
Judge.
| |
/s/ Rajit Mittal |
| Date: January 8, 2025 |
Signature of Lawyer for the Petitioner
Rajit Mittal |
| | | 2025 Special Meeting of Securityholders |
APPENDIX
E
SCOTIABANK FAIRNESS OPINION
See attached.
| | SILVERCREST METALS INC. | E-1 |
| | | 2025 Special Meeting of Securityholders |
| |
Scotia Capital Inc.
40 Temperance Street, 6th Floor
Toronto, ON
Canada M5H 0B4
|
October 3, 2024
The Special Committee of the Board of Directors of SilverCrest Metals Inc.
570 Granville Street, Suite 501
Vancouver, British Columbia
V6C 3P1
To the Special Committee
Scotia Capital Inc. (“Scotia Capital”,
“we”, “us” or “our”) understands that SilverCrest Metals Inc. (“SilverCrest” or the “Company”),
Coeur Mining, Inc. (“Coeur” or the “Acquirer”) and 1504648 B.C. Unlimited Liability Company (“Coeur Canadian
Sub”), among others, propose to enter into an arrangement agreement to be dated October 3, 2024 (the “Arrangement Agreement”),
pursuant to which, among other things, the Acquirer, through Coeur Canadian Sub, will acquire all of the outstanding common shares (the
“Shares”) of the Company pursuant to a plan of arrangement (the “Arrangement”) under the Business Corporations
Act (British Columbia). Under the terms of the Arrangement, holders of the Shares (each, a “Shareholder”) will
be entitled to receive 1.6022 newly issued common shares of the Acquirer for each Share held (the “Consideration”). The terms
and conditions of the Arrangement Agreement will be fully described in a management information circular (the “Circular”)
which will be mailed to the Shareholders and holders of stock options of the Company (the “Optionholders”, and together with
the Shareholders, the “Securityholders”) in connection with a special meeting of Securityholders to be held to consider and,
if deemed advisable, approve the Arrangement.
We have been retained to provide financial advice
and assistance to the special committee of the board of directors of SilverCrest (the “Special Committee”) in evaluating the
Arrangement, including providing our opinion (the “Opinion”) to the Special Committee as to the fairness, from a financial
point of view, of the Consideration to be received pursuant to the Arrangement by the Shareholders.
Engagement of Scotia Capital
The Company initially contacted Scotia Capital
regarding a potential advisory assignment on September 25, 2024. Scotia Capital was formally engaged by the Special Committee pursuant
to an engagement letter dated September 27, 2024 (the “Engagement Letter”). Under the terms of the Engagement Letter, the
Company has agreed to pay Scotia Capital a fixed fee for its services as financial advisor, including rendering the Opinion. The fee that
Scotia Capital will receive for its advisory services is not contingent upon the completion of the Arrangement Agreement or the conclusion
of an opinion. In addition, Scotia Capital is to be reimbursed for its reasonable out-of-pocket expenses and to be indemnified by the
Company for certain liabilities that may arise out of the performance of professional services rendered by Scotia Capital under the Engagement
Letter.
Subject to the terms of the Engagement Letter,
Scotia Capital consents to the inclusion of the Opinion in its entirety and a summary thereof in the Circular and to the filing of the
Opinion by the Company, as necessary, with the applicable securities commissions, stock exchanges and other similar regulatory authorities
in Canada and the United States.
Credentials of Scotia Capital
Scotia Capital represents the global corporate
and investment banking and capital markets business of Scotiabank Group (“Scotiabank”), one of North America’s premier
financial institutions. In Canada, Scotia Capital is one of the country’s largest investment banking firms with operations in all
facets of corporate and government finance, mergers and acquisitions, equity and fixed income sales and trading and investment
research. Scotia Capital has participated in
a significant number of transactions involving private and public companies and has extensive experience in preparing fairness opinions.
The Opinion expressed herein represents the
opinion of Scotia Capital. The form and content of the Opinion have been approved for release by a committee of senior investment banking
professionals of Scotia Capital, each of whom is experienced in merger, acquisition, divestiture, fairness opinion and valuation matters.
Independence of Scotia Capital
Neither Scotia Capital nor any of its affiliates
is an insider, associate or affiliate (as those terms are defined in the Securities Act (British Columbia)) of the Company, the
Acquirer or any of their respective associates or affiliates (collectively, the “Interested Parties”).
Neither Scotia Capital nor any of its affiliates
has been engaged to provide any financial advisory services, nor has Scotia Capital or any of its affiliates participated in any financing,
involving the Interested Parties within the past two years, other than pursuant to the Engagement Letter and as described herein.
In the past two years, Scotia Capital and affiliates
of Scotia Capital have been engaged in the following capacities for the Interested Parties: (i) acted as Joint Lead Arranger, Joint Bookrunner
and Administrative Agent on the Company’s US$70 million syndicated revolving credit facility; (ii) provided foreign exchange spot
trading and hedging services to the Company; (iii) provided general banking and cash management services to the Company; (iv) acted as
a lender in the Acquirer’s US$390 million syndicated revolving credit facility; (v) acted as agent on the Acquirer’s normal
course issuer bid; and (vi) provided general banking and cash management services to the Acquirer.
Scotia Capital may, in the future, in the ordinary
course of its business, perform financial advisory or investment banking services, from time to time, for the Interested Parties, but
there are currently no understandings, agreements or commitments between Scotia Capital and the Interested Parties with respect to any
future business dealings, except as otherwise described herein or in connection with the Arrangement. In addition, the Bank of Nova Scotia
(“BNS”), of which Scotia Capital is a wholly-owned subsidiary, or one or more affiliates of BNS, may provide banking or other
financial services to one or more of the Interested Parties in the ordinary course of business.
Scotia Capital acts as a trader and dealer,
both as principal and agent, in the financial markets in Canada, the United States and elsewhere and, as such, it and Scotiabank may have
had and may have positions in the securities of the Interested Parties from time to time and may have executed or may execute transactions
on behalf of such companies or clients for which it receives compensation. As an investment dealer, Scotia Capital conducts research on
securities and may, in the ordinary course of business, provide research reports and investment advice to its clients on investment matters,
including with respect to the Interested Parties, or with respect to the Arrangement. It is also possible that, in the ordinary course
of business, certain employees of Scotia Capital or its affiliates currently own, or may have owned, securities of an Interested Party.
Scope of Review
In preparing the Opinion, we have reviewed, considered and relied
upon, among other things, the following:
| 1. | a draft of the Arrangement Agreement dated October 3, 2024; |
| 2. | a substantially final draft of
the Voting and Support Agreement (the “Company Support Agreements”) with each of the directors and senior officers of the
Company dated October 3, 2024; |
| 3. | a substantially final draft of
the Voting and Support Agreement (the “Acquirer Support Agreements”) with each of the directors and senior officers of the
Acquirer dated October 3, 2024; |
| 4. | audited annual financial statements
of the Company and the Acquirer and management’s discussion and analysis related thereto for the fiscal years ended 2022 and 2023; |
| 5. | unaudited interim financial statements
of the Company and the Acquirer and management’s discussion and analysis related thereto for the three and six month period ended
June 30, 2024; |
| 6. | the notices of annual meeting
of the Shareholders of the Company and the management information circulars of the Company for the meetings to be held on June 15, 2023
and June 12, 2024; |
| 7. | the notices of annual meeting
of the shareholders and the definitive proxy statements of the Acquirer for the meetings to be held on May 9, 2023 and May 14, 2024; |
| 8. | certain other securities regulatory
filings of the Company and the Acquirer for the fiscal years ended 2021, 2022 and 2023; |
| 9. | internal management forecasts,
projections, estimates and budgets prepared or provided by or on behalf of management of the Company and the Acquirer, including the SilverCrest
Financial Model and Coeur Financial Model (each as defined herein); |
| 10. | internal financial, operating
and corporate information or reports of the Company and the Acquirer; |
| 11. | discussions with senior management
of the Company with respect to various risks related to existing mines, project development, the Company’s and the Acquirer’s
long-term prospects and other issues and matters considered by us to be relevant; |
| 12. | public information relating to
the business, operations, financial performance and stock trading history of the Company, the Acquirer and other selected public companies
considered by us to be relevant; |
| 13. | public information with respect
to other transactions of a comparable nature considered by us to be relevant; |
| 14. | third party expert reports, such
as technical reports relating to the Company and the Acquirer; |
| 15. | reports published by equity research
analysts and industry sources we considered relevant; |
| 16. | historical market prices and
trading activity for the Shares and the common shares of the Acquirer; |
| 17. | representations contained in
a certificate addressed to Scotia Capital, dated as of the date hereof, from senior officers of the Company as to the completeness, accuracy
and fair presentation of the information upon which the Opinion is based (the “Certificate”); and |
| 18. | such other corporate, industry
and financial market information, investigations and analyses as Scotia Capital considered necessary or appropriate in the circumstances. |
Scotia Capital has not, to the best of its knowledge,
been denied access by the Company or the Acquirer to any information that has been requested by Scotia Capital.
Prior Valuations
Senior officers of the Company (with respect
to and on behalf of the Company and not in their personal capacity) have represented to Scotia Capital that, to the best of their knowledge
after reasonable inquiry, there have been no valuations or appraisals of the Company or its securities or material assets, including prior
valuations (as defined in Multilateral Instrument 61-101 – Protection of Minority Security Holders in Special Transactions (“MI
61-101”)), which have been prepared as of a date within the twenty-four (24) month period
preceding the date of this Opinion that are
in the possession or control or knowledge of the Company other than those provided to Scotia Capital or, in the case of valuations or
appraisals known to the Company which it does not have within its control, notice of which has been given to Scotia Capital.
Assumptions and Limitations
The Opinion is subject to the assumptions, qualifications and limitations
set forth below.
We have relied upon the completeness, accuracy
and fair presentation of all of the financial and other information, data, advice, documents, opinions, appraisals, valuations and representations
obtained by it from public sources, or that was provided to us by the Company, and its associates and affiliates and advisors (collectively,
the “Information”). The Opinion is conditional upon the completeness, accuracy and fair presentation of the Information. Subject
to the exercise of our professional judgment we have not attempted to verify independently the completeness, accuracy or fair presentation
of the Information.
We are not legal, regulatory, accounting or
tax experts and have relied on the assessments made by the Company and its advisors with respect to such matters. We have assumed the
accuracy and fair presentation of, and relied upon, the Company’s audited financial statements and the reports of the auditors thereon
and the Company’s interim unaudited financial statements. We have assumed that forecasts, projections, estimates and budgets provided
to us, and used in the analysis supporting the Opinion, were reasonably prepared on bases reflecting the best currently available estimates
and judgments of management of the Company as to the matters covered thereby.
The Opinion has been prepared in accordance
with the Investment Dealer and Partially Consolidated Rules of the Canadian Investment Regulatory Organization (“CIRO”), but
CIRO has not been involved in its preparation or review.
Senior officers of the Company have represented
to Scotia Capital in the Certificate that, among other things, to the best of their knowledge (a) the Company has no information or knowledge
of any facts public or otherwise not specifically provided to Scotia Capital relating to the Company, the Acquirer, or any of their respective
subsidiaries and affiliates which would reasonably be expected to affect the Opinion in any material respect; (b) with the exception of
forecasts, projections or estimates referred to in (e), below, the Information provided to Scotia Capital, directly or indirectly, orally
or in writing by the Company, the Acquirer or any of their associates, affiliates, agents, advisors, consultants or representatives in
respect of the Company, the Acquirer and their respective subsidiaries and affiliates, in connection with the Arrangement or the provision
of services by Scotia Capital under the Engagement Letter is or, in the case of historical information or data, was, at the date of preparation,
true and accurate in all material respects, and does not contain any untrue statement of a material fact (as defined in the Securities
Act (British Columbia)) in respect of the Company, the Acquirer or any of their subsidiaries or affiliates or the Arrangement and
does not and did not omit to state a material fact in respect of the Company, the Acquirer or any of their subsidiaries or affiliates
or the Arrangement necessary to make the Information not misleading in light of circumstances in which the Information was made or provided
to Scotia Capital, provided that the foregoing representation as it relates to the Acquirer and its subsidiaries and affiliates was qualified
by the knowledge of the Company after due enquiry; (c) since the dates on which the Information was provided to Scotia Capital, there
have been no changes in material facts, new material facts or material changes (as such term is defined in Securities Act (British
Columbia)) which have not been disclosed to Scotia Capital or updated by more current Information that has been disclosed; (d) since the
dates on which the Information was provided to Scotia Capital, except as has been disclosed to Scotia Capital in writing, management of
the Company is not aware of any circumstances or developments that could reasonably be expected to have a material effect on the assets,
liabilities, financial condition, prospects or affairs of the Company or the Acquirer, or any of their respective subsidiaries, associates
or affiliates, or which would have or which would reasonably be expected to affect the Opinion, including the assumptions used, the scope
of review undertaken or the conclusions reached; and (e) with respect to any portions of the Information provided to Scotia Capital which
constitute forecasts, projections or estimates, such portions of the Information: (i) were reasonably prepared and reflected the best
currently available estimates and judgements; (ii) were prepared using the assumptions identified therein, which, in the reasonable opinion
of management of the
Company, are and continue to be reasonable in
the circumstances; (iii) are not misleading in any material respect in light of the assumptions used and with reference to the circumstances
in which such budgets, strategic plans, financial forecasts, projections, models and/or estimates were provided or in light of any developments
since the time of their preparation which have been disclosed to Scotia Capital; and (iv) represent the actual views of management of
the Company of the financial prospects and forecasted performance of the Company (and, as applicable, the Acquirer) and the Arrangement.
In preparing the Opinion, Scotia Capital made
several assumptions, including that the final executed version of the Arrangement Agreement, the Company Support Agreements and the Acquirer
Support Agreements will not differ in any material respect from the most recent draft thereof reviewed by us, and that the Arrangement
will be consummated in accordance with the terms and conditions, substantially within the time frames, set forth in the Arrangement Agreement
without any waiver or amendment of any terms or conditions. In addition, we have assumed that the Arrangement was negotiated at arm’s
length, that the Arrangement is not a “related party transaction” as defined under MI 61-101, and the conditions precedent
to the completion of the Arrangement can be satisfied in due course, all consents, permissions, exemptions or orders of relevant third
parties or regulatory authorities will be obtained without adverse condition or qualification, and the procedures being followed to implement
the Arrangement are valid and effective.
The Opinion is rendered on the basis of the
securities markets and economic, financial and general business conditions prevailing as at the date hereof and the conditions and prospects,
financial and otherwise, of the Company, the Acquirer and their respective subsidiaries and affiliates, as they were reflected in the
Information and as they have been represented to Scotia Capital in discussions with management of the Company and its representatives.
In its analyses and in preparing the Opinion, Scotia Capital made numerous assumptions with respect to industry performance, general business
and economic conditions and other matters, which Scotia Capital believes to be reasonable and appropriate in the exercise of its professional
judgment, many of which are beyond the control of Scotia Capital or any party involved in the Arrangement.
The Opinion has been provided for the sole use
and benefit of the Special Committee in connection with, and for the purpose of, its consideration of the Arrangement and may not be used
or relied upon by any other person and we understand that it will be one factor, among others, that they will consider in their evaluation
of the Arrangement. The Opinion was not intended to be, and does not constitute, a recommendation to the Special Committee as to whether
they should approve the Arrangement or to any shareholder of the Company as to how such shareholder should vote or act with respect to
the Arrangement or its Shares. The Opinion does not address in any manner the prices at which the Company’s and the Acquirer’s
securities will trade at any time or the value of the Company or the Acquirer at a future date and does not provide assurance that the
best possible price or transaction was obtained. The Opinion does not address the relative merits of the Arrangement as compared to other
transactions or business strategies that might be available to the Company or the Company’s underlying business decision to effect
the Arrangement.
Scotia Capital has not been asked to opine on,
nor does it offer any opinion as to the material terms (other than the Consideration) of the Arrangement Agreement. In addition, the Opinion
does not address the fairness of any consideration or value provided to any person who validly exercises the right of dissent of such
person in respect of the Arrangement. In carrying out its engagement, Scotia Capital was not authorized to solicit and did not solicit,
interest from any other party with respect to the acquisition of the Company or any other business combination or other transaction involving
the Company or its assets, nor did Scotia Capital negotiate with any other party in connection with any such transaction.
Except for the inclusion of the Opinion in its
entirety and a summary thereof in a form reasonably acceptable to us in the Circular, the Opinion is not to be reproduced, disseminated,
quoted from or referred to (in whole or in part) without our prior written consent. We have not been asked to prepare and have not prepared
a formal valuation or appraisal of the securities or assets of the Company or any of its affiliates, and the Opinion should not be construed
as such.
The Opinion is given as of the date hereof,
and Scotia Capital disclaims any undertaking or obligation to advise any person of any change in any fact or matter affecting the Opinion
which may come or be brought to the
attention of Scotia Capital after the date hereof.
Without limiting the foregoing, in the event that there is any material change in any fact or matter affecting the Opinion after the date
hereof, Scotia Capital reserves the right to change, modify or withdraw the Opinion, but it is not obligated to do so.
Description of SilverCrest
SilverCrest is a Canadian-based precious metals
producer whose principal focus is operating its Las Chispas Mine, in Sonora, Mexico. The Company declared commercial production for the
Las Chispas Mine on November 1, 2022, after completion of construction and commissioning of the processing plant in late May 2022. The
Company has a market capitalization of approximately US$1.4 billion and an enterprise value of approximately US$1.3 billion as at the
date hereof. The Shares are traded on the Toronto Stock Exchange under the stock symbol “SIL” and on the NYSE American Stock
Exchange under the stock symbol “SILV”.
Description of Coeur
Coeur is a precious metals producer with assets
located in the United States, Canada, and Mexico, including four wholly-owned operations: the Palmarejo gold-silver complex in Mexico,
the Rochester silver-gold mine in Nevada, the Kensington gold mine in Alaska and the Wharf gold mine in South Dakota. In addition, Coeur
owns the Silvertip polymetallic exploration project in British Columbia. Coeur has a market capitalization of approximately US$2.8 billion
and an enterprise value of approximately US$3.4 billion as at the date hereof. Its shares are traded on the NYSE under the stock symbol
“CDE”.
Summary of Financial Analysis and Approach to Fairness
In support of the Opinion, Scotia Capital has
performed certain analyses based on the methodologies and assumptions that Scotia Capital considered appropriate in the circumstances
for the purposes of providing its Opinion. Scotia Capital believes that its analyses must be considered as a whole and that selecting
portions of the analyses or the factors considered by it, without considering all factors and analyses together, could create a misleading
view of the process underlying the Opinion. The preparation of a fairness opinion is a complex process and is not necessarily susceptible
to partial analysis or summary description. Any attempt to do so could lead to undue emphasis on any particular factor or analysis.
In considering the fairness, from a financial
point of view, of the Consideration to be received pursuant to the Arrangement by the Shareholders, Scotia Capital considered the following
matters, among others:
Financial Projections
In the course of our analysis, Scotia Capital
reviewed, among other things, financial models provided by management of the Company for each of SilverCrest (the “SilverCrest Financial
Model”) and Coeur (the “Coeur Financial Model”). These financial models include, among other things, assumptions, estimates
and projections regarding resources, future commodity prices, production levels, operating and capital costs, depreciation, taxes, royalties
and mine life. Management of the Company has represented to Scotia Capital that the financial models reflect, and continue to reflect,
the best currently available assumptions, estimates and judgements of management of the Company and were prepared using the assumptions
identified therein, which, in the reasonable belief of management of the Company are and continue to be reasonable in the circumstances.
Scotia Capital has adjusted the financial models
to using the average of equity research analyst estimates for future commodity prices rather than the estimates for future commodity prices
provided by management of the Company. Such adjustments are to ensure that the forecasts for future commodity prices are comparable to
those used by equity research analysts in calculating the net asset values and cash flows that are utilized in the comparable trading
and precedent transaction analyses described below.
Net Asset Value Analysis
Scotia Capital determined net asset values
for each of SilverCrest and Coeur as of June 30, 2024, by calculating, at the applicable point in time, the estimated present value of
the future unlevered, after-tax free cash flows that each of SilverCrest and Coeur was forecasted to generate based on the SilverCrest
Financial Model and the Coeur Financial Model. The present values of the unlevered, after-tax free cash flows that each of SilverCrest
and Coeur were forecasted to generate were calculated by applying a discount rate of 5%, which represents the discount rate commonly
used for precious metal companies by equity research analysts, as well as other financial and industry participants, in calculating net
asset values. The resulting present values were then adjusted to reflect, among other things, the net cash or net debt balance as of
June 30, 2024, and the estimated, tax-effected, present value of future corporate general and administrative expenses, for each of SilverCrest
and Coeur.
The above-described analysis resulted in an
approximate implied per Share net asset value of US$4.76 for SilverCrest (the “SilverCrest NAV per Share”) and an approximate
implied per share net asset value of US$4.21 for Coeur (the “Coeur NAV per share”). The calculation of net asset value for
each of SilverCrest and Coeur made no assumptions regarding the financing of any forecast capital expenditures.
Comparable Trading Analysis
Scotia Capital reviewed selected publicly traded
precious metals companies and compared those companies to each of SilverCrest and Coeur on several factors, including jurisdiction, geographic
location, production scale and commodity mix. Scotia Capital recognizes that no company reviewed in the comparable trading analysis is
directly comparable to Silvercrest or Coeur, as applicable, and that each of the selected publicly traded precious metals companies is
unique in terms of size, geographic location, production scale and commodity mix.
Scotia Capital primarily reviewed the multiple
of price to net asset value based on, to the extent available to Scotia Capital, the average of equity research analyst estimates of the
net asset value per share for the selected publicly traded precious metals companies.
As a secondary approach, Scotia Canada reviewed
the multiple of price to estimated 2025 cash flow per share based on, to the extent available to Scotia Capital, the average of equity
research estimates of 2025 cash flow per share for the selected publicly traded precious metals companies.
Scotia Capital reviewed the following publicly
traded precious metals companies for the purposes of the comparable trading analysis with respect to SilverCrest (the “SilverCrest
Comparable Companies”):
SilverCrest Comparable Companies
| Hecla Mining Company |
| First Majestic Silver Corp. |
| Aya Gold & Silver Inc. |
| MAG Silver Corp. |
| Endeavour Silver Corp |
Scotia Capital calculated the average and median
price to net asset value multiple for the SilverCrest Comparable Companies to be 1.41x and 1.35x, respectively, and observed the high
and low price to net asset value multiple for the SilverCrest Comparable Companies to be 1.99x and 1.12x, respectively. A price to net
asset value multiple range of 1.20x to 1.90x was selected based on several factors, including the average
multiples of the SilverCrest Comparable Companies
and Scotia Capital’s experience and professional judgement. Scotia Capital applied the selected multiple range described above to
SilverCrest NAV per Share, which implied a range of Share prices for SilverCrest of US$5.72 to US$9.05.
Scotia Capital calculated the average and median
price to estimated 2025 cash flow per share multiple for the SilverCrest Comparable Companies to be 13.3x and 11.8x, respectively, and
observed the high and low price to estimated 2025 cash flow per share multiple for the SilverCrest Comparable Companies to be 22.8x and
7.0x, respectively. A price to estimated 2025 cash flow per share multiple range of 10.5x to 12.0x was selected based on several factors,
including the average multiples of the SilverCrest Comparable Companies and Scotia Capital’s experience and professional judgement.
Scotia Capital applied the selected multiple range described above to the estimated cash flow per Share of SilverCrest for 2025 as determined
by the SilverCrest Financial Model, which implied a range of share prices for SilverCrest of US$9.05 to US$10.35.
Scotia Capital reviewed the following publicly
traded precious metals companies for the purposes of the comparable trading analysis with respect to Coeur (the “Coeur Comparable
Companies”):
Coeur Comparable Companies
| Pan American Silver Corp. |
| Hecla Mining Company |
| First Majestic Silver Corp. |
| MAG Silver Corp. |
Scotia Capital calculated the average and median
price to net asset value multiple for the Coeur Comparable Companies to be 1.46x and 1.37x, respectively, and observed the high and low
price to net asset value multiple for the Coeur Comparable Companies to be 1.99x and 1.10x, respectively. A price to net asset value multiple
range of 1.30x to 1.90x was selected based on several factors, including the average multiples of the Coeur Comparable Companies and Scotia
Capital’s experience and professional judgement. Scotia Capital applied the selected multiple range described above to the Coeur
NAV per share, which implied a range of share prices for Coeur of US$5.48 to US$8.00.
Scotia Capital calculated the average and median
price to estimated 2025 cash flow per share multiple for the Coeur Comparable Companies to be 10.4x and 11.1x, respectively, and observed
the high and low price to estimated 2025 cash flow per share multiple for the Coeur Comparable Companies to be 12.5x and 7.4x, respectively.
A price to estimated 2025 cash flow per share multiple range of 10.5x to 12.0x was selected based on several factors, including the average
multiples of the Coeur Comparable Companies and Scotia Capital’s experience and professional judgement. Scotia Capital applied the
selected multiple range described above to the estimated cash flow per share of Coeur for 2025 as determined by the Coeur Financial Model,
which implied a range of share prices for Coeur of US$10.89 to US$12.45.
Precedent Transaction Analysis
Scotia Capital reviewed available public information
for selected precedent transactions involving producing precious metal companies and assets that Scotia Capital, based on its experience
and professional judgement, considered relevant. Scotia Capital recognizes that no company or transaction reviewed in the precedent transactions
analysis is directly comparable to SilverCrest or the Arrangement, and that each of the selected precedent precious metal company transactions
is: (i) unique in terms of size, geographic location, commodity mix, prevailing market conditions and transaction structure and (ii) reflective
of the strategic rationale of both the respective acquirer and target.
Page 9
Scotia Capital primarily reviewed the multiple of price to net asset
value based on, to the extent available to Scotia Capital, the average of equity research analyst estimates of the net asset value of
the target at the date of each precedent transaction.
As a secondary approach, Scotia Capital reviewed the multiple of
price to one year forward cash flow per share based on, to the extent available to Scotia Capital, the average of equity research estimates
of one year forward cash flow per share of the target at the date of each precedent transaction.
Scotia Capital reviewed the following precedent transactions involving
producing precious metal companies (the “Precedent Transactions”):
Precedent M&A Transactions
| Date |
Target |
Acquirer |
| 05-Sep-24 |
Gatos Silver Inc. |
First Majestic Silver Corp. |
| 08-Nov-21 |
Pretium Resources Inc. |
Newcrest Mining Limited |
| 19-Mar-18 |
Klondex Mines Ltd. |
Hecla Mining Company |
| 11-Sep-17 |
Richmont Mines Inc. |
Alamos Gold Inc. |
| 29-Sep-16 |
Newmarket Gold Inc. |
Kirkland Lake Gold Ltd. |
| 07-Mar-16 |
Claude Resources Inc. |
SSR Mining Inc. |
| 08-Feb-16 |
Lakeshore Gold Corp. |
Tahoe Resources Inc. |
Scotia Capital calculated both the average and
median price to net asset value multiple observed for the Precedent Transactions to be 1.46x, and observed the high and low price to net
asset value multiple for the Precedent Transactions to be 1.78x and 1.17x, respectively. A price to net asset value multiple range of
1.46x to 1.78x was selected based on several factors, including, the average values of the Precedent Transactions, market conditions at
the time, and Scotia Capital’s experience and professional judgement. Scotia Capital applied the selected price to net asset value
multiple range described above to the SilverCrest NAV per Share, which implied a range of share prices for SilverCrest of US$6.95 to US$8.48
per share.
Scotia Capital calculated the average and median
price to one year forward cash flow per share multiple for the Precedent Transactions to be 9.0x and 7.6x, respectively, and observed
the high and low price to one year forward cash flow per share multiple for the Precedent Transactions to be 15.7x and 5.4x, respectively.
A price to one year forward cash flow per share multiple range of 9.0x to 15.7x was selected based on several factors, including the average
values of the Precedent Transactions and Scotia Capital’s experience and professional judgement. Scotia Capital applied the selected
multiple range described above to the estimated cash flow per Share of SilverCrest for 2025 as determined by the SilverCrest Financial
Model, which implied a range of share prices for SilverCrest of US$7.76 to US$13.54 per share.
Implied Exchange Ratio Analysis
In evaluating the Consideration, Scotia
Capital relied upon the methodologies presented herein, as well as the assumptions, explanations and limitations set forth herein,
to determine a range of values for each of the Shares and the shares of Coeur. Based upon this range of values, Scotia Capital
calculated a range of implied exchange ratios, in each case being the number of Coeur shares per Share, against which the
Consideration was compared.
Based upon the implied values from the Comparable
Trading Analysis for each of SilverCrest and Coeur, the resulting range of implied exchange ratios is 0.714x to 1.653x based on price
to net asset value multiples, and 0.727x to 0.950x based on price to estimated 2025 cash flow multiples.
Based upon the implied values from the Precedent
Transactions Analysis for SilverCrest and the Comparable Trading Analysis for Coeur, the resulting range of implied exchange ratios is
0.869x to 1.548x based on price to net asset value multiples, and 0.623x to 1.242x based on price to estimated 2025 cash flow multiples.
Additional Consideration Analysis
In evaluating the shares of Coeur to be issued
as the Consideration under the Arrangement, Scotia Capital is of the view that the current trading price of the Coeur shares represents
a reasonable proxy for the value of the Coeur shares.
As of the date of the Opinion, Coeur’s
trading value is not inconsistent with the implied values for Coeur resulting from the methodologies presented herein. In addition, Coeur
has a public float (excluding insiders and holders of greater than 10% of the shares outstanding) of approximately 357 million shares
and during the 90-day period ended October 2, 2024, the average daily trading volume of Coeur was approximately 7.2 million shares. Coeur
is well known to market professionals, with eight equity research analysts providing research coverage. Upon completion of the Arrangement,
Shareholders would own approximately 37% of the outstanding shares of Coeur.
Accordingly, Scotia Capital is of the view that
the Consideration should be considered equivalent to approximately US$11.26 per Share, as of October 2, 2024.
Other Factors Considered
Although not forming part of our financial analysis,
Scotia Capital considered several other factors in arriving at the Opinion, including the following:
| a) | the historical trading prices
of the Shares on the NYSE American Exchange during the 52-week period ended October 2, 2024, which indicate a 52-week low to high per
share price range for the Shares of US$4.27 to US$10.27; |
| b) | equity research analyst price
targets for the Shares, as of October 2, 2024, as reflected in equity research analyst reports available to Scotia Capital, which indicate
a price range for the Shares of US$8.38 to US$11.40; |
| c) | the premiums implied by the Consideration
relative to the closing prices and the 20-day volume weighted average trading prices of the Shares and the common shares of Coeur as of
October 2, 2024; and |
| d) | the range of implied discounted
cash flow (“DCF”) values per Share of US$5.15 to US$5.44 for SilverCrest and US$6.04 to US$6.76 per share for Coeur, resulting
in a range of implied exchange ratios of 0.761x to 0.900x. The range of implied DCF values per share for each of SilverCrest and Coeur
were calculated using the same methodology as described above in Net Asset Value Analysis, but using spot commodity prices as of October
2, 2024, in lieu of the average of equity research analyst estimates for future commodity prices. In addition, instead of using a discount
rate of 5%, Scotia Capital used the capital asset pricing model and various other assumptions to estimate the real estimated weighted
average cost of capital range for each of SilverCrest and Coeur, which implied a range of real discount rates of 8.5% to 10.5% for SilverCrest,
and for Coeur, a range of real discount rates of 7.5% to 9.5% for its assets in the United States, 8.0% to 10.0% for its assets in Mexico,
and a weighted average range of 7.6% to 9.6% for its future corporate general and administrative expenses. |
Conclusion
Based upon and subject to the foregoing, Scotia Capital is of the
opinion that, as of the date hereof, the Consideration to be received by the Shareholders pursuant to the Arrangement is fair from a financial
point of view to the Shareholders.
Yours very truly,
"signed" Scotia Capital Inc.
SCOTIA CAPITAL INC.
| | | 2025 Special Meeting of Securityholders |
APPENDIX
F
CORMARK FAIRNESS OPINION
See attached.
| | SILVERCREST METALS INC. | F-1 |
October 3, 2024
The Board of Directors of SilverCrest Metals Inc.
570 Granville Street, Suite 501
Vancouver, BC
Canada V6C 3P1
To the Board of Directors of SilverCrest Metals Inc.:
Cormark Securities Inc. (“Cormark Securities”,
“we” or “us”) understands that SilverCrest Metals Inc. (“SilverCrest” or the
“Company”), Coeur Mining, Inc. (“Coeur” or the “Acquiror”), 1504648 B.C. Unlimited
Liability Company, a wholly-owned subsidiary of the Acquiror (“SubCo”), Coeur Rochester, Inc., a wholly-owned subsidiary
of the Acquiror (“Coeur US SubCo”), and Compañía Minera La Llamarada, S.A. De C.V., a wholly-owned subsidiary
of the Company (“Company Mexican SubCo”), propose to enter into an arrangement agreement dated October 3, 2024 (the
“Arrangement Agreement”) pursuant to which, among other things, Coeur, through SubCo will acquire 100% of the outstanding
common shares of SilverCrest (each a “SilverCrest Share”) with each holder of SilverCrest Shares entitled to receive,
in exchange for each SilverCrest Share held, 1.6022 common shares (each whole share a “Coeur Share”, and such ratio
the “Exchange Ratio”) of Coeur (the “Consideration”, and collectively, the “Transaction”).
We also understand that:
| · | the Transaction as contemplated by the Arrangement
Agreement is proposed to be effected by way of a statutory plan of arrangement under the Business Corporations Act (British Columbia)
(the “Arrangement”); |
| · | the terms and conditions of the Transaction will
be fully described in a management information circular of SilverCrest (the “Circular”) to be mailed to SilverCrest
shareholders (the “SilverCrest Shareholders”) and SilverCrest optionholders (the “SilverCrest Optionholders,
and together with the SilverCrest Shareholders, the “SilverCrest Securityholders”) in connection with a special meeting
of the SilverCrest Securityholders to be held to consider and, if deemed advisable, approve the Transaction; and |
| · | each of the directors and senior officers of the
Company and Coeur have entered into voting support agreements (the “Voting Agreements”) pursuant to which, amongst
other things, each of them will agree to vote in favour of the Transaction. |
Cormark Securities has been retained by the
Board of Directors of SilverCrest (the “Board of Directors”) to provide an opinion to the Board of Directors with respect
to the fairness, from a financial point of view, of the Consideration to be paid by Coeur to the SilverCrest Shareholders pursuant to
the Transaction (the “Fairness Opinion”). We understand that the formal valuation requirement under Multilateral Instrument
61-101 - Protection of Minority Security Holders in Special Transactions (“MI 61-101”) does not apply in respect
of the Transaction. This Fairness Opinion does not constitute a “formal valuation” within the meaning of MI 61-101.
CORMARK SECURITIES’ ENGAGEMENT
Cormark Securities was formally retained to
act as financial advisor to the Company in respect of the Transaction on July 15, 2024 (the “Engagement Letter”). Under
the terms of the Engagement Letter, Cormark Securities agreed to provide the Board of Directors with advisory services in connection with
the Transaction including, among other things, the provision of the Fairness Opinion.
The terms of the Engagement Letter provide that
Cormark Securities shall be paid a fixed fee upon delivery of the Fairness Opinion that is not contingent in whole or in part on the success
or completion of the Transaction or on the conclusions reached in the Fairness Opinion, to be paid within two business days of the oral
delivery of the Fairness Opinion, which occurred on the date hereof (the “Opinion Date”), as well as an additional
advisory fee that is
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contingent upon the completion of the Transaction
or an alternative transaction completed within 12 months following the termination of the Engagement Letter. In addition, Cormark Securities
is to be reimbursed for its reasonable out-of-pocket expenses and is to be indemnified by the Company, in certain circumstances, against
certain expenses, losses, claims, actions, damages and liabilities incurred in connection with the provision of its services pursuant
to the Engagement Letter. The fees paid and to be paid to Cormark Securities in connection with the Engagement Letter are not financially
material to Cormark Securities.
On the Opinion Date, at the request of the Board
of Directors, Cormark Securities orally delivered the Fairness Opinion to the Board of Directors based upon and subject to the scope of
review, analyses, assumptions, limitations, qualifications and other matters described herein. This Fairness Opinion provides the same
opinion, in writing, as that delivered orally by Cormark Securities to the Board of Directors on the Opinion Date. This Fairness Opinion
has been prepared in accordance with the Disclosure Standards for Formal Valuations and Fairness Opinions of the Canadian Investment Regulatory
Organization (“CIRO”), but CIRO has not been involved in the preparation or review of this Fairness Opinion.
CREDENTIALS OF CORMARK SECURITIES
Cormark Securities is an independent Canadian
investment dealer providing investment research, equity sales and trading and investment banking services to a broad range of institutions
and corporations. Cormark Securities has participated in a significant number of transactions involving public and private companies,
maintains a particular expertise advising companies in the global mining sector and has extensive experience in preparing fairness opinions.
This Fairness Opinion represents the opinion
of Cormark Securities and its form and content have been approved for release by a committee of senior investment banking professionals
of Cormark Securities, each of whom is experienced in merger, acquisition, divestiture, valuation, fairness opinion and other capital
markets matters.
INDEPENDENCE OF CORMARK SECURITIES
Neither Cormark Securities, nor any of its affiliates
or associates, is an insider, associate or affiliate (as those terms are defined in the Securities Act (Ontario) (the “Act”))
of the Company, the Acquiror, or any of their respective associates, affiliates, or subsidiaries (collectively, the “Interested
Parties”).
Cormark Securities has not been engaged to provide
financial advisory services to any of the Interested Parties nor has it participated in any financing involving any of the Interested
Parties within the past 24-month period, other than completing a block trade for Coeur in January 2023, selling approximately six million
common shares of Victoria Gold Corp. owned at that time by Coeur for aggregate gross proceeds of approximately C$55 million.
There are no understandings, agreements or commitments
between Cormark Securities and any Interested Party with respect to any future business dealings. However, Cormark Securities may, in
the future, in the ordinary course of its business, perform financial advisory or investment banking services for an Interested Party.
Cormark Securities acts as a trader and dealer,
both as principal and agent, in all major financial markets in Canada and, as such, may have had, may have, and may in the future have,
positions in the securities of SilverCrest, Coeur or other Interested Parties and, from time to time, may have executed or may execute
transactions on behalf of such entities or other clients for which it may have received or may receive compensation. As an investment
dealer, Cormark Securities conducts research on securities and may, in the ordinary course of its business, provide research reports and
investment advice to its clients on investment matters, including matters with respect to the Transaction, SilverCrest, or other Interested
Parties.
SCOPE OF REVIEW
In connection with preparing the Fairness Opinion,
Cormark Securities has reviewed, relied upon (without verifying or attempting to verify independently the completeness or accuracy thereof)
or carried out, among other things, the following:
| a) | a draft
of the Arrangement Agreement between SilverCrest, Coeur, Subco, Coeur US Subco and Company Mexican Subco as of October 3, 2024 and a
draft of supporting schedules thereto including the plan of arrangement (the “Plan of Arrangement”); |
| b) | a settled form of the Voting Agreements to be
entered by each of the directors and senior officers of the Company and Coeur; |
| c) | a written non-binding acquisition proposal to
the Company from Coeur dated as of August 9, 2024, and an amendment thereto dated September 13, 2024 extending the exclusivity period
agreed by the parties; |
| d) | correspondence from management of Coeur to management
of the Company relating to the proposed Transaction, including in respect of the Exchange Ratio; |
| e) | audited consolidated financial statements and
management’s discussion and analysis (“MD&A”) of each of the Company and Coeur for the fiscal years ended
December 31, 2023, 2022 and 2021, in the case of Coeur, as contained in Coeur’s annual reports on Form 10-K filed with the United
States Securities and Exchange Commission (the “SEC”); |
| f) | quarterly financial statements and MD&A of
each of the Company and Coeur for the quarters ended June 30, 2024, March 31, 2024, September 30, 2023, June 30, 2023, March 31, 2023,
September 30, 2022, June 30, 2022, March 31, 2022, September 30, 2021, June 30, 2021 and March 31, 2021, in the case of Coeur, as contained
in Coeur’s quarterly reports on Form 10-Q filed with the SEC; |
| g) | annual information forms of SilverCrest for the
years ended December 31, 2023, 2022 and 2021; |
| h) | Las Chispas Operation Technical Report dated September
2, 2023 prepared for SilverCrest by Ausenco Engineering Canada Inc.; |
| i) | Palmarejo Operations Mexico Technical Report Summary
dated February 16, 2022 prepared for Coeur by Mr. Christopher Pascoe, RM SME, Mr. Miller O’Prey, P. Geo., Mr. Peter Haarala, RM
SME and Mr. Joseph Ruffini, RM SME; |
| j) | Rochester Operations Nevada Technical Report Summary
dated February 16, 2022 prepared for Coeur by Mr. Christopher Pascoe, RM SME, Mr. Brandon MacDougall, P.E., Mr. Matthew Bradford, RM SME
and Mr. Matthew Hoffer, P.G.; |
| k) | Kensington Gold Operations Alaska Technical Report
Summary dated February 16, 2022 prepared for Coeur by Mr. Christopher Pascoe, RM SME, Ms. Rae Keim, P. Geo and Mr. Peter Haarala, RM SME; |
| l) | Wharf Operations South Dakota Technical Report
Summary dated February 16, 2022 prepared for Coeur by Mr. Christopher Pascoe, RM SME, Mr. Tony Auld, RM SME, Ms. Lindsay Chasten, RM SME,
Mr. Kenan Sarratt, RM SME and Mr. John Key, RM SME; |
| m) | certain other public information relating to the
business, operations, financial condition and equity trading history of the Company, Coeur and other selected public issuers considered
by Cormark Securities to be relevant; |
| n) | certain internal financial, operational, corporate
and other information prepared or provided by or on behalf of management of each of the Company and Coeur relating to the business operations
and financial condition of the Company and Coeur, respectively; |
| o) | certain internal management forecasts, projections,
estimates and budgets prepared or provided by or on behalf of management of each of the Company and Coeur; |
| p) | discussions and communications with management
of the Company relating to the current business, plan, financial condition and prospects of the Company and Coeur; |
| q) | public information in respect of select precedent
transactions Cormark Securities considered relevant; |
| r) | investment research reports published by equity
research analysts and industry sources regarding the Company, Coeur and other public issuers to the extent considered by Cormark Securities
to be relevant; |
| s) | site visits to certain operations of the Company
and Coeur in 2023 and 2024 by representatives of Cormark Securities; |
| t) | a letter of representation as to certain factual
matters and the completeness and accuracy of certain information upon which the Fairness Opinion is based, addressed to us and dated as
of the date hereof, provided by senior officers of the Company (the “Certificate”); and |
| u) | such other information, investigations, analyses
and discussions as we considered necessary or appropriate. |
Cormark Securities has not, to the best of its
knowledge, been denied access by the Company or the Acquiror to any information requested by Cormark Securities. Cormark Securities did
not meet with the auditors of the Company and has assumed the accuracy, completeness and fair presentation of, and has relied upon, without
independent verification, the consolidated financial statements of the Company and the reports of the auditors thereon.
PRIOR VALUATIONS
The Company has represented to Cormark Securities
that there have not been any prior valuations (as defined in MI 61-101) or existing externally prepared third party appraisals or valuations
in the possession, control or knowledge of the Company relating to the Company (or, to the knowledge of the Company after due inquiry,
Coeur) or the Arrangement prepared within the 24-month period preceding the date of the Fairness Opinion.
ASSUMPTIONS AND LIMITATIONS
Cormark Securities has not been asked to prepare
and has not prepared a formal valuation of the Company or Coeur pursuant to MI 61-101 or otherwise, or any of their respective securities
or assets, and the Fairness Opinion should not be construed as such. In addition, the Fairness Opinion is not, and should not be construed
as, advice as to the price at which the SilverCrest Shares or Coeur Shares may trade or the value of the Company or Coeur at any future
date. Cormark Securities was similarly not engaged to review any legal, tax or accounting aspects of the Transaction and expresses no
opinion concerning any legal, tax, or accounting matters concerning the Transaction. Cormark Securities has relied upon, without independent
verification or investigation, the assessment by the Company and its legal, tax, regulatory and accounting advisors with respect to legal,
tax, regulatory and accounting matters. In addition, the Fairness Opinion does not address the relative merits of the Transaction as compared
to any other transaction involving the Company or the prospects or likelihood of any alternative transaction or any other possible transaction
involving the Company, its assets or its securities. The Fairness Opinion is limited to the fairness, from a financial point of view,
of the Consideration to be paid by the Acquiror in connection with the Arrangement and not the strategic or legal merits of the Transaction.
The Fairness Opinion does not provide assurance that the best possible price or transaction was obtained. Nothing contained herein is
to be construed as a legal interpretation, an opinion on any contract or document, or a recommendation to invest or divest.
The Fairness Opinion has been provided for the
exclusive use of the Board of Directors and should not be construed as a recommendation to vote in favour of the Transaction and should
not be relied upon by any other person. Except for the inclusion of the Fairness Opinion in its entirety and a summary thereof (in a form
acceptable to us) in the Circular, the Fairness Opinion is not to be reproduced, disseminated, quoted from or referred to (in whole or
in part) without our prior written consent. Cormark Securities will not be held liable for any losses sustained by any person should the
Fairness Opinion be circulated, distributed, published, reproduced or used contrary to the provisions of this paragraph.
The Fairness Opinion is rendered as of the Opinion
Date on the basis of securities markets, economic and general business and financial conditions prevailing on such date and the condition
and prospects, financial and otherwise, of the Company and Coeur and their respective affiliates, as reflected in the Information (as
defined below) and as represented to Cormark Securities in discussions with management of SilverCrest. It must be recognized that fair
market value (which we define as “the monetary consideration that, in an open and unrestricted market, a prudent and informed buyer
would pay to a prudent and informed seller, each acting at arm’s length with the other and under no compulsion to act”), and
hence fairness from a financial point of view, changes from time to time, not only as a result of internal factors, but also because of
external factors such as changes in the economy, commodity prices, environmental laws and regulations, markets for minerals, competition
and changes in consumer/investor preferences. Cormark Securities disclaims any undertaking or obligation to advise any person of any change
in any fact or matter affecting the Fairness Opinion which may come or be brought to Cormark Securities’ attention after the Opinion
Date. Without limiting the foregoing, in the event that there is any material change in any fact or matter affecting the Fairness Opinion
after the Opinion Date, Cormark Securities reserves the right to change, modify or withdraw the Fairness Opinion.
With the approval of the Board of Directors,
Cormark Securities has relied upon the completeness, accuracy and fair presentation of all information (including the financial models,
technical information, business plans, forecasts and other information), data, advice, opinions and representations obtained by Cormark
Securities from public sources or provided to Cormark Securities, directly or indirectly, orally or in writing by the Company, Coeur or
any of their respective associates or affiliates or agents, advisors, consultants and representatives in connection with the Engagement
Letter, including, in particular, for the purpose of preparing the Fairness Opinion (collectively, the “Information”)
and Cormark Securities has assumed that the Information did not omit to state any material fact or any fact necessary to be stated to
make the Information not misleading. The Fairness Opinion is conditional upon the completeness, accuracy and fair presentation of the
Information and assumes there are no undisclosed material facts, no new material facts or other changes with respect to the Company or
the Acquiror. Subject to the exercise of professional judgment and except as expressly described herein, Cormark Securities has not attempted
to independently verify or investigate the completeness, accuracy or fair presentation of any of the Information.
With respect to any financial and operating
forecasts, projections, financial models, estimates and/or budgets provided to Cormark Securities and used in the analyses supporting
the Fairness Opinion, Cormark Securities has noted that projecting future results of any business is inherently subject to uncertainty.
Cormark Securities has assumed that such forecasts, projections, financial models, estimates and/or budgets were reasonably prepared consistent
with industry and past practices on a basis reflecting the best currently available assumptions, estimates and judgments of management
of the Company or Coeur, as applicable, as to the future financial performance of the Company or Coeur, as applicable, and are (or were
at the time and continue to be) reasonable in the circumstances. In rendering the Fairness Opinion, Cormark Securities expresses no view
as to the reasonableness of such forecasts, projections, financial models, estimates and/or budgets or the assumptions on which they are
based.
The Chief Executive Officer and Director and
Interim Chief Financial Officer of the Company have made certain representations to Cormark Securities in the Certificate with the intention
that Cormark Securities may rely thereon in connection with the preparation of the Fairness Opinion, including that:
| a) | all Information is, at the date hereof, or in
the case of historical Information, was at the date of preparation, complete, true and correct in all material respects, including as
it relates to the Company, Coeur or the Transaction, as applicable, and does not and did not contain any untrue statement of “material
fact” (as such term is defined in the Act in respect of the Company, Coeur or their respective subsidiaries or the Transaction and
does not and did not omit to state any material fact in respect of the Company, Coeur or their respective subsidiaries or the Transaction
necessary to make the Information not misleading in light of the circumstances under which the Information was made or provided to Cormark
Securities (collectively, a “Misrepresentation”) (except to the extent that any such Information has been superseded
by Information subsequently delivered in writing to Cormark Securities), provided that the foregoing representation as it relates to Coeur
and its subsidiaries was qualified by the knowledge of the Company after due inquiry; |
| b) | with respect to any portions of the Information
that constitute budgets, strategic plans, financial forecasts, projections, models or estimates, such portions of the Information: (i)
were reasonably prepared and |
| | | reflected
the best currently available estimates and judgments (ii) were prepared using the assumptions
identified therein or otherwise disclosed to Cormark Securities that are (or were at the
time of preparation) reasonable in the circumstances; (iii) are not misleading in any material
respect in light of the assumptions used and with reference to the circumstances in which
such budgets, strategic plans, financial forecasts, projections, models and/or estimates
were provided or in light of any developments since the time of their preparation which have
been disclosed to Cormark Securities; and (iv) represent the actual views of management of
the financial prospects and forecasted performance of the Company (and, as applicable, Coeur
or its subsidiaries) and the Transaction provided that the foregoing representation as it
relates to Coeur and its subsidiaries is qualified by the knowledge of the Company after
due inquiry; |
| c) | all financial material, documentation and other
data concerning the Company and its subsidiaries (and, to the knowledge of the Company after due inquiry, Coeur or its subsidiaries) and
the Transaction, including any projections or forecasts provided to Cormark Securities, were prepared on a basis consistent in all material
respects with the accounting policies applied in the most recent audited consolidated financial statements of the Company (and, as applicable,
Coeur); |
| d) | since the dates on which the Information was provided
to Cormark Securities, there has been no material change (as such term is defined in the Act, financial or otherwise, in the financial
condition, assets, liabilities (contingent or otherwise), business, operations or prospects of the Company or its subsidiaries (and, to
the knowledge of the Company after due inquiry, Coeur or its subsidiaries) and there is no new material fact which is of a nature as to
render any portion of the Information or any part thereof untrue or misleading in any material respect; |
| e) | since the dates on which the Information was provided
to Cormark Securities, except as has been disclosed to Cormark Securities: (i) no material transaction has been entered into or contemplated
by the Company (and, to the knowledge of the Company after due inquiry, Coeur) other than the Transaction, and there is no plan or proposal
for any material change in the affairs of the Company, or any of its subsidiaries, associates or affiliates or its securities (and, to
the knowledge of the Company after due inquiry, Coeur or any of its subsidiaries, associates or affiliates or its securities); and (ii)
management of the Company is not aware of any circumstances or developments that could reasonably be expected to have a material effect
on the assets, liabilities, financial condition, prospects or affairs of the Company or Coeur, or any of their respective subsidiaries,
associates or affiliates; |
| f) | there are no “prior valuations” (as
such term is defined in MI 61-101) or existing externally prepared third party appraisals or valuations in the possession, control or
knowledge of the Company relating to the Company (or, to the knowledge of the Company after due inquiry, Coeur) or the Transaction, prepared
as at a date within the 24 months preceding the date hereof and no such valuation or appraisal has been commissioned by the Company or
any of its subsidiaries (or, to the knowledge of the Company after due inquiry, Coeur) or is known to the Company to be in the course
of preparation; |
| g) | there are no material agreements, undertakings,
commitments or understandings (written or oral, formal or informal) relating to the Transaction, except as have been disclosed to Cormark
Securities; |
| h) | there
are no material facts or information which have not been included in the Company’s
(or, to the knowledge of the Company after due inquiry, Coeur) public disclosure documents
filed on www.sedarplus.ca (“SEDAR+”) or on the Company’s website
(or in the case of Coeur, filed with the SEC at www.sec.gov or on Coeur’s website)
(the “Disclosure Documents”) or otherwise not disclosed to Cormark Securities
in writing relating to the Company, Coeur or any of their respective subsidiaries; |
| i) | the contents of the Disclosure Documents were,
as of their respective dates, true and correct in all material respects and do not contain any Misrepresentation and such Disclosure Documents
comply with all requirements under applicable laws provided that in respect of the Disclosure Documents of Coeur, the foregoing representations
are qualified by the knowledge of the Company after due inquiry; |
| j) | there have been no written offers or material
negotiations relating to the purchase or sale of all or a material portion of the Company’s assets, made or received within the
preceding 24 months which have not been disclosed to Cormark Securities; and |
| k) | other than as disclosed in the Disclosure Documents
and the Information, the Company (and, to the knowledge of the Company after due inquiry, Coeur) do not have any material contingent liabilities
and there are no actions, suits, proceedings or inquiries, pending or, to our knowledge, threatened, against or affecting the Company,
Coeur or any of their respective subsidiaries at law or in equity or before federal, provincial, municipal or other government department,
commission, bureau, board, agency or instrumentality which has or could reasonably be expected to have a material adverse affect on the
Company and its subsidiaries, taken as a whole (or, to the knowledge of the Company after due inquiry, Coeur and its subsidiaries taken
as a whole). |
In its analyses and in preparing the Fairness
Opinion, Cormark Securities has made numerous other assumptions with respect to expected industry performance, general business and economic
conditions and other matters, many of which are beyond the control of Cormark Securities or any party involved in the Transaction (including
exchange rate and commodity price assumptions). Cormark Securities has also assumed that the executed Arrangement Agreement will not differ
in any material respect from the drafts that Cormark Securities reviewed, the Transaction will be consummated in accordance with the terms
and conditions thereof, substantially within the time frames specified in the Arrangement Agreement without any waiver or material amendment
of any material term or condition thereof or of the Plan of Arrangement contemplated in the Arrangement Agreement, that the Transaction
was negotiated at arm’s length and that the Transaction is not a “related party transaction”, “issuer bid”
or “insider bid” as defined under MI 61-101, that any governmental, regulatory or other consents and approvals necessary for
the consummation of the Transaction will be obtained without any adverse effect, the disclosure provided or incorporated by reference
in the Circular to be filed on SEDAR+ and mailed to SilverCrest Securityholders in connection with the Transaction and any other documents
in connection with the Transaction prepared by a party to the Arrangement Agreement will be accurate in all material respects and will
comply with the requirements of all applicable laws, that all of the conditions required to implement the Transaction will be met, that
the procedures being followed to implement the Transaction are valid and effective, and that the Circular will be distributed to SilverCrest
Securityholders in accordance with applicable laws.
The Fairness Opinion is rendered as of the date
hereof and Cormark Securities disclaims any undertaking or obligation to advise any person of any change in any fact or matter affecting
the Fairness Opinion which may come or be brought to Cormark Securities’ attention after the date hereof. Without limiting the foregoing,
in the event that there is any change in any fact or matter affecting the Fairness Opinion after the date hereof, Cormark Securities reserves
the right to change, modify or withdraw the Fairness Opinion.
FAIRNESS OPINION
Based upon and subject to the foregoing and
such other matters we considered relevant, Cormark Securities is of the opinion that, as of the date hereof, the Consideration to be received
by the SilverCrest Shareholders pursuant to the Arrangement is fair, from a financial point of view, to the SilverCrest Shareholders.
Yours very truly,
"signed" Cormark Securities Inc.
CORMARK SECURITIES INC.
| | | 2025 Special Meeting of Securityholders |
APPENDIX
G
RAYMOND JAMES FAIRNESS OPINION
See
attached.
| | SILVERCREST METALS INC. | G-1 |
October 3, 2024
The Board of Directors of SilverCrest Metals Inc.
570 Granville Street, Suite 501
Vancouver, British Columbia V6C 3P1
To the Board of Directors of SilverCrest Metals Inc.:
Raymond James Ltd. (“Raymond James”,
“we” or “us”) understands that SilverCrest Metals Inc. (“SilverCrest” or the
“Company”) and Coeur Mining, Inc. (“Coeur”) intend to enter into an arrangement agreement (the “Arrangement
Agreement”) pursuant to which Coeur will, among other things, acquire (through a wholly-owned subsidiary) all of the issued
and outstanding common shares of SilverCrest (“SilverCrest Shares”) via a court approved plan of arrangement (the “Arrangement”)
under the Business Corporations Act (British Columbia) (the “Transaction”). Under the terms of the Transaction,
holders of SilverCrest Shares (the “Shareholders”) will receive 1.6022 common shares of Coeur (the “Consideration”)
for each SilverCrest Share held (the “Exchange Ratio”). The Exchange Ratio implies a consideration of US$11.34 per
SilverCrest Share, based on the closing price of common shares of Coeur on the New York Stock Exchange ("NYSE") on October
3, 2024.
The terms and conditions of the Arrangement
will be summarized in SilverCrest’s management information circular (the “Circular”) to be mailed to the Shareholders
and holders of stock options of Silvercrest (the “Optionholders, and together with the Shareholders, the “Securityholders”)
in connection with a special meeting of the Securityholders to be held to consider and, if deemed advisable, approve the Arrangement.
We have been retained to provide financial advice to the Company, including our opinion (the “Opinion”) to the board
of directors of Company (the “Board of Directors”) as to whether the Consideration to be received under the Arrangement
is fair, from a financial point of view, to the Shareholders.
Engagement of Raymond James
Raymond James was formally engaged by the Company
pursuant to an engagement letter dated June 6, 2024 (the “Engagement Agreement”). Under the terms of the Engagement
Agreement, Raymond James has agreed to provide this Opinion to the Board of Directors.
Pursuant to the terms of the Engagement Agreement,
Raymond James will receive a fixed fee for rendering this Opinion. In addition, Raymond James will be paid a separate fee for its advisory
services pursuant to the Engagement Agreement that is contingent on the completion of the Arrangement (and is to be reduced by an amount
equal to the fee paid for the delivery of this Opinion) and is also to be reimbursed for approved and reasonable legal and other out-of-pocket
expenses. Raymond James and its affiliates and their respective directors, officers, partners, employees, agents and controlling persons
are to be indemnified by the Company from and against certain potential liabilities arising out of its engagement. Raymond James’
compensation for providing this Opinion is not contingent on an action or event resulting from the use of the Opinion.
Independence of Raymond James
Neither Raymond James nor any of its affiliates
or associates is an “associated entity”, an “affiliated entity” or an “issuer insider” (as such terms
are defined under Multilateral Instrument 61-101 – Protection of Minority Security
Raymond James Ltd.
Suite 5400 – 40 King Street West, Toronto,
ON, M5H 3Y2 · 416 777 7000 · 416 777 7020 Fax
Holders in Special Transactions (“MI
61-101”)) of the Company, Coeur, or any of their respective affiliates or associates (collectively, the “Interested
Parties”).
Raymond James has not been engaged to provide
financial advisory services, nor has it participated in any financings involving the Interested Parties within the past two years, other
than acting as financial advisor to the Company pursuant to the Engagement Agreement. There are no other understandings, agreements or
commitments between Raymond James and the Interested Parties with respect to any current or future business dealings which would be material
to the Opinion.
Raymond James may, in the ordinary course of
its business, provide financial advisory or investment banking services to the Interested Parties or their respective affiliates or associates
from time to time. In addition, in the ordinary course of its business, Raymond James acts as a trader and dealer, both as principal and
agent, in major financial markets and, as such, may have, today or in the future, positions in the securities of the Interested Parties
or their respective affiliates or associates, and, from time to time, may have executed or may execute transactions on behalf of the Interested
Parties or other clients for which it received or may receive compensation. In addition, as an investment dealer, Raymond James conducts
research on securities, and may, in the ordinary course of its business, provide research reports and investment advice to its clients
on investment matters, including with respect to the Interested Parties or their respective affiliates or associates.
Credentials of Raymond James
Raymond James is a North American full-service
investment dealer with operations located across Canada. Raymond James is a member of the Toronto Stock Exchange, the TSX Venture Exchange,
the Montreal Exchange, the Canadian Investment Regulatory Organization (formerly the Investment Industry Regulatory Organization of Canada)
(“CIRO”), the Investment Funds Institute of Canada, and the Canadian Investor Protection Fund. Raymond James and its
officers have prepared numerous valuations and fairness opinions and have participated in a significant number of transactions involving
private and publicly-traded companies. Raymond James is indirectly wholly-owned by Raymond James Financial, Inc. (“Raymond James
Financial”). Raymond James Financial is a diversified financial services holding company listed on the NYSE (NYSE: RJF) whose
subsidiaries engage primarily in investment and financial planning, including securities and insurance, brokerage, investment banking,
asset management, banking and cash management, and trust services.
The Opinion expressed herein represents the
opinion of Raymond James and the form and content of this Opinion have been reviewed and approved for release by a committee of managing
directors of Raymond James. The committee members are professionals experienced in providing valuations and fairness opinions for mergers
and acquisitions as well as providing capital markets advice. The Opinion has been prepared in accordance with the disclosure standards
for fairness opinions of CIRO but CIRO has not been involved in the preparation or review of the Opinion.
Overview of SilverCrest
SilverCrest is a Canadian precious metals producer
headquartered in Vancouver, British Columbia, with an ongoing initiative to increase its silver-gold assets by expanding current resources
and reserves, acquiring, discovering, developing and operating high value precious metal projects in the Americas.
SilverCrest's principal focus is its Las Chispas
Operation in Sonora, Mexico. SilverCrest has an ongoing initiative to increase its asset base by expanding current resources and reserves,
acquiring, discovering, and developing
high value precious metals projects and ultimately
operating multiple silver-gold mines in the Americas. SilverCrest is led by a proven management team in all aspects of the precious metal
mining sector, including taking projects through discovery, finance, on time and on budget construction, and production.
Overview of Coeur
Coeur is a U.S-based, well-diversified, growing
precious metals producer with four wholly-owned operations: the Palmarejo gold-silver complex in Mexico, the Rochester silver-gold mine
in Nevada, the Kensington gold mine in Alaska and the Wharf gold mine in South Dakota. In addition, Coeur wholly-owns the Silvertip polymetallic
critical minerals exploration project in British Columbia.
Coeur’s strategy is to be well-diversified,
growing precious metals producer with a focus on generating sustainable, high-quality cash flow and returns from a balanced, prospective
asset base in mining-friendly jurisdictions along with its commitment to exploration and expansions.
Scope of Review
In connection with rendering our Opinion, we
have reviewed and relied without independent verification upon, among other things, the following:
| i. | A non-binding proposal submitted by Coeur to SilverCrest, dated August 9, 2024; |
| ii. | A draft of the Arrangement Agreement and the schedules attached thereto (together with disclosure letters
relating thereto); |
| iii. | A draft of the form of voting support agreement to be entered into by directors and officers of the Company; |
| iv. | A draft of the form of voting support agreement to be entered into by directors and officers of Coeur; |
| v. | Consolidated annual financial statements, and management’s discussion and analysis, of the Company
for the years ended December 31, 2023, 2022, and 2021 together with the notes thereto and the auditors' reports thereon; |
| vi. | Consolidated annual financial statements, and management’s discussion and analysis, of Coeur for
the years ended December 31, 2023, 2022, and 2021 together with the notes thereto and the auditors' reports thereon; |
| vii. | SilverCrest’s condensed interim consolidated financial statements and management’s discussion
and analysis for the three month periods ended June 30, 2024, March 31, 2024, September 30, 2023, June 30, 2023, March 31, 2023, September
30, 2022, June 30, 2022, March 31, 2022; |
| viii. | Coeur’s condensed interim consolidated financial statements and management’s discussion and
analysis for the three month periods ended June 30, 2024, March 31, 2024, September 30, 2023, June 30, 2023, March 31, 2023, September
30, 2022, June 30, 2022, March 31, 2022; |
| ix. | Certain public disclosure by the Company as filed on the System for Electronic Document Analysis and Retrieval+
(“SEDAR+”), including press releases issued by the Company; |
| x. | Certain public disclosure by Coeur as filed on SEDAR+ and the system for Electronic Data Gathering, Analysis,
and Retrieval (“EDGAR”), including press releases issued by the Coeur; |
| xi. | Certain public investor presentations and marketing materials prepared by SilverCrest and Coeur; |
| xii. | Various verbal and written conversations with management of the Company with regards to the operations,
financial condition and corporate strategy of the Company; |
| xiii. | Certain internal financial, operational, corporate and other information with respect to the Company,
including financial models prepared by management of the Company, as well as internal operating and financial projections prepared or
reviewed by management of the Company (and discussions with management with respect to such information, model, projections and presentations); |
| xiv. | The financial model of Coeur received from the Company and revised version thereto dated September 26,
2024; |
| xv. | Forecasted metal prices provided by management of the Company and consensus forecasted metal prices; |
| xvi. | Discussions with management respecting potential alternative strategic transaction with select third parties
other than Coeur that were considered by the special committee of the Board of Directors (the “Special Committee”),
and the status, outcomes and probabilities of those potential alternative strategic transactions; |
| xvii. | Selected public market trading statistics and financial information of the Company, Coeur, and other entities
considered by us to be relevant; |
| xviii. | Other public information relating to the business, operations and financial condition of the Company and
Coeur considered by us to be relevant; |
| xix. | Other publicly available information relating to selected public companies considered by us to be relevant,
including published reports by equity research analysts and industry reports; |
| xx. | Information with respect to selected precedent transactions considered by us to be relevant; and |
| xxi. | Such other information, analyses, investigations, and discussions as we considered necessary or appropriate
in the circumstances. |
We have participated in various discussions
with members of the Company’s senior management regarding the Company’s business, operations, financial condition, corporate
strategy and prospects, and we have participated in various discussions with members of the Company’s senior management regarding
Coeur’s business, operations, financial condition, corporate strategy and prospects. We have also participated in various discussions
with Cassels Brock & Blackwell LLP, Canadian legal counsel to the Company, and Paul, Weiss, Rifkind, Wharton & Garrison LLP, U.S
legal counsel to the Company, concerning the Arrangement Agreement and related matters. Raymond James has not, to the best of its knowledge,
been denied access by the Company or Coeur to any information requested by Raymond James.
Prior Valuations
The Chief Executive Officer and the Chief Financial
Officer of the Company have represented to Raymond James that, to the best of their knowledge, there have been no valuations or appraisals
relating to the Company or any of its subsidiaries, or any of their respective material assets, made in the preceding 24 months, including
any “prior valuation” within the meaning of MI 61-101.
Assumptions and Limitations
Our Opinion is subject to the assumptions, qualifications and limitations
set forth below.
We have not been asked to prepare and have not
prepared a formal valuation under MI 61-101 or appraisal of any of the assets or securities of the Company, Coeur or any of their respective
subsidiaries and our Opinion should not be construed as such. We have relied upon the advice of counsel to the Company that while the
Arrangement is a “business combination” within the meaning of MI 61-101 and is subject to “minority approval”
thereunder, the Arrangement is exempt from the formal valuation requirements of MI 61-101.
We have relied upon, and have assumed the completeness,
accuracy and fair presentation of all information, data, advice, opinions and representations obtained by us from public sources, or provided
to us by the Company or its affiliates or advisors or otherwise obtained by us pursuant to our engagement, and our Opinion is conditional
upon such completeness, accuracy and fair presentation. We have not been requested to, or attempted to, verify independently the accuracy,
completeness or fairness of presentation of any such information, data, advice, opinions and representations. We have not met separately
with the independent auditors of the Company or Coeur in connection with preparing our Opinion and have assumed the accuracy and fair
presentation of, and relied upon, the Company’s and Coeur’s audited financial statements and the reports of the auditors thereon
and the Company’s and Coeur’s interim unaudited financial statements.
With respect to the non-historical financial
data, operating and financial forecasts and budgets provided to us concerning the Company and Coeur and relied upon in our financial analyses,
we have assumed that they have been reasonably prepared on bases reflecting the most reasonable assumptions, estimates and judgements
of management of the Company, having regard to the Company’s and Coeur’s business, plans, financial condition and prospects.
We have also assumed that the Arrangement will be completed substantially in accordance with its terms (without any waiver or amendment
of any terms or conditions) and all applicable laws, and the Circular will disclose all material facts relating to the Arrangement and
will satisfy all applicable legal requirements.
We have assumed that the Arrangement Agreement
(including the schedules thereto and the disclosure letter relating thereto) will not differ materially from the form of the drafts reviewed
by us; we have assumed that the representations and warranties made by the parties in the Arrangement Agreement are true and correct.
The Company has represented to us, in a certificate
of its Chief Executive Officer and the Chief Financial Officer dated the date hereof, among other things, that the information (financial
or otherwise), data, documents, opinions, appraisals, valuations and other information and materials of whatsoever nature or kind provided
to us by or on behalf of the Company relating to the Company or the Arrangement, including, without limitation, the written information
and discussions concerning the Company referred to under the heading “Scope of Review” (collectively, the “Information”),
are complete, true and correct in all material respects at the date the Information was provided to us and that no change has occurred
in the Information or any part thereof, since the respective dates which would have or which would reasonably be expected to have a material
effect on the Opinion or the Arrangement.
Our Opinion does not address the relative merits
of the Arrangement as compared to other transactions or business strategies that might be available to the Company, nor does it address
the underlying business decision to implement the Arrangement. Our Opinion does not address the treatment of the Company’s optionholders,
DSU, RSU or PSU holders under the Arrangement.
We are not legal, tax or accounting experts
and we express no opinion concerning any legal, tax or accounting matters concerning the Arrangement or the sufficiency of this Opinion
for your purposes; we have relied upon, without independent verification, the assessment by the Company and its legal, tax and accounting
advisors with respect to such matters.
Our Opinion is rendered on the basis of securities
markets, economic and general business and financial conditions prevailing as at the date hereof and the conditions and prospects, financial
and otherwise, of the Company as they are reflected in the Information and as they were represented to us in our discussions with management
of the Company and advisors. In our analyses and in connection with the preparation of our Opinion, we made numerous assumptions with
respect to industry performance, general business, markets and economic conditions and other matters, many of which are beyond the control
of any party involved in the Arrangement.
The Opinion is being provided to the Board of
Directors for its exclusive use only in considering the Arrangement and, except for the inclusion of the Opinion in its entirety and a
summary thereof (in a form acceptable to us) in the Circular, may not be published, disclosed to any other person, relied upon or used
by any other person, or used for any other purpose, without the prior written consent of Raymond James. Our Opinion is not intended to
be and does not constitute a recommendation to any Shareholder to accept or reject the Arrangement, nor as an opinion concerning the trading
price or value of any securities of the Company at any time, including following the announcement, completion or termination of the Arrangement.
Raymond James believes that its analyses must
be considered as a whole and that selecting portions of its analyses and the factors considered by it, without considering all factors
and analyses together, could create a misleading view of the process underlying the Opinion. The preparation of an opinion is complex
and is not necessarily susceptible to partial analysis or summary description and any attempt to do so could lead to undue emphasis on
any particular factor or analysis; accordingly, our Opinion should be read in its entirety.
The Opinion is given as of the date hereof and,
although we reserve the right to change or withdraw the Opinion if we learn that any of the information, including the Information, that
we relied upon in preparing the Opinion was inaccurate, incomplete or misleading in any material respect, we disclaim any obligation to
change or withdraw the Opinion, to advise any person of any change that may come to our attention or to update the Opinion after the date
of the Opinion.
Fairness Methodologies
In support of the Opinion, Raymond James has
performed certain financial analyses on the Company, based on those methodologies and assumptions that Raymond James considered appropriate
in the circumstances for the purposes of providing its Opinion. In the context of the Opinion, Raymond James has considered the following
methodologies (as each such term is defined below):
a) Premiums Paid Analysis;
b) Public Company Trading with
Premium Approach; and
c) Precedent Transactions Approach.
Premiums Paid Analysis
Raymond James compared the Consideration pursuant
to the Arrangement to the 20-day volume weighted average trading price of the SilverCrest Shares on the NYSE American as of October 3,
2024, the last trading day prior to the announcement of the Transaction, to premiums paid over the past seven years in select Canadian
change of control transactions (the “Premiums Paid Analysis”).
Public Company Trading with Premium Approach
Raymond James compared public market trading
statistics of the Company and Coeur to corresponding data from selected publicly-traded precious metal producers that we considered relevant.
Factors such as number of assets, asset size, location of assets, stage of development, revenue breakdown by metal, operating costs and
mining techniques were also considered. Raymond James considered multiples based on price to net asset value (“P/NAV”),
which is a measure of share price relative to net asset value per share, price to cash flow, which is a measure of share price relative
to operating cash flow per share, and enterprise value to EBITDA, which is a measure of equity value plus net debt relative to earnings
before interest, tax, depreciation and amortization, to be the most relevant metrics. We examined those metrics for each of the comparable
companies and then applied a range of selected multiples to the corresponding data of the Company to calculate an implied equity value
of the Company, to which Raymond James added a change of control premium (the “Public Company Trading with Premium Approach”).
Precedent Transactions Approach
The precedent transactions approach considers
transaction multiples in the context of the purchase or sale of a public company or asset. Raymond James reviewed publicly available information
in connection with change of control transactions involving publicly-traded precious metal producers that we considered relevant (the
“Precedent Transactions Approach”). Factors such as number of assets, asset size, location of assets, stage of development,
revenue breakdown by metal, operating costs and mining techniques were also considered. Raymond James considered multiples of P/NAV to
be the most relevant metric for the Company in consideration of precedent transactions.
Fairness Considerations
The assessment of fairness of the Consideration,
from a financial point of view, must be determined in the context of the particular transaction. Raymond James based its conclusion in
the Opinion upon a number of quantitative and qualitative factors including, but not limited to:
| a) | the Consideration payable for each SilverCrest Share pursuant to the Arrangement represents a significant
premium that compares favourably to the premium range derived from the Premiums Paid Analysis; |
| b) | the Consideration payable for each SilverCrest Share pursuant to the Arrangement compares favourably with
the financial range derived from our analyses using the Public Company Trading with Premium Approach; |
| c) | the Consideration payable for each SilverCrest Share pursuant to the Arrangement compares favourably with
the financial range derived from our analyses using the Precedent Transactions Approach; and |
| d) | other factors or analyses, which we have judged, based on our experience in rendering such opinions, to
be relevant, including, among other things, conversations with management of the Company, the Board of Directors and the Special Committee
regarding the operations, financial condition, prospects and corporate strategy of the Company. |
Raymond James did not, in considering the fairness,
from a financial point of view, of the Consideration to be received pursuant to the Arrangement, assess any income tax consequences that
any particular Shareholder may face in connection with the Arrangement.
Opinion
Based upon and subject to the foregoing and such other matters as
we considered relevant, it is our opinion that, as of the date hereof, the Consideration to be received by the Shareholders pursuant to
the Transaction is fair, from a financial point of view, to the Shareholders.
Yours very truly,
"signed" Raymond James Ltd.
Raymond James Ltd.
| | SILVERCREST METALS INC. | G-9 |
| | | 2025 Special Meeting of Securityholders |
APPENDIX
H
INFORMATION CONCERNING COEUR
Notice
to Reader
The following
information concerning Coeur should be read in conjunction with the documents incorporated by reference into this Appendix H and the
information concerning Coeur appearing elsewhere in this Circular. Unless the context indicates otherwise, capitalized terms which are
used in this Appendix H and not otherwise defined in this Appendix H have the meanings given to such terms under the heading
“Glossary of Terms” in this Circular.
Forward-Looking
Statements
Certain statements
contained in this Appendix H, and in certain documents incorporated by reference in this Appendix H, constitute forward-looking
statements or information within the meaning of applicable Canadian Securities Laws. Such forward-looking statements relate to future
events or Coeur’s future performance. See “Forward-Looking Information” in this Circular.
Documents
Incorporated by Reference
Coeur files annual,
quarterly, and current reports, proxy statements, and other information with the SEC and on SEDAR+. Annual and quarterly reports, proxy
and information statements, and other information about Coeur filed with the SEC and on SEDAR+ can be accessed at www.sec.gov and www.sedarplus.ca,
respectively. Copies of documents filed with the SEC or on SEDAR+ by Coeur will be available free of charge from Coeur’s website
at www.coeur.com under the “Investors” tab or by contacting Coeur's Investor Relations Department at (312) 489-5800
or investors@coeur.com. Unless otherwise provided below, the information provided in Coeur's public filings (or available on Coeur's
website) is not part of this Circular and is not incorporated by reference.
Any statement
contained in a document incorporated or deemed to be incorporated by reference in this Circular is deemed to be part of this Circular,
except for any information superseded by information in this Circular or in later filed documents incorporated by reference into this
Circular (excluding any current reports on Form 8-K to the extent disclosure is furnished and not filed). Any statement so modified or
superseded will not be deemed, except as so modified or superseded, to constitute a part of this Circular. These documents are considered
to be a part of this Circular, effective as of the date they are filed. In the event of conflicting information in these documents, the
information in the latest filed document should be considered correct. The making of a modifying or superseding statement will not be
deemed an admission for any purpose that the modified or superseded statement, when made, constituted a misrepresentation, an untrue
statement of a material fact or an omission to state a material fact that is required to be stated or that is necessary to make a statement
not misleading in light of the circumstances in which it was made.
This Circular
incorporates by reference the documents set forth below that Coeur has previously filed with the SEC and any additional documents that
Coeur may file with the SEC under Section 13(a), 13(c), 14 or 15(d) of the Exchange Act after the date of this Circular and until the
date of the Meeting and Coeur Stockholders meeting (other than those documents, or the portions of those documents or exhibits thereto,
deemed to be furnished and not filed in accordance with SEC rules). These documents contain important information about Coeur, its business
and its financial condition and performance.
Statements contained
in this Circular regarding the contents of any contract or other document, are not necessarily complete and each such statement is qualified
in its entirety by reference to the full text of that contract or other document filed as an exhibit with the SEC.
This Circular
incorporates by reference the documents set forth below previously filed with the SEC and filed by Coeur on its profile on SEDAR+ at
www.sedarplus.ca as “Other”:
| · | the
Coeur Annual Report; |
| · | the
information contained in Coeur’s definitive proxy statement on Schedule 14A filed with
the SEC on April 4, 2024, and incorporated into Part IV of the Coeur Annual Report; |
| · | Coeur’s
Quarterly Reports on Form 10-Q for the quarters ended March 31, 2024, June 30, 2024 and September
30, 2024, filed with the SEC on May 1, 2024, August 7, 2024 and November 6, 2024, respectively; |
| | SILVERCREST METALS INC. | H-1 |
| | | 2025 Special Meeting of Securityholders |
| · | Coeur’s
Current Reports on Form 8-K filed with the SEC on January 29, 2024, February 21, 2024, February
27, 2024, March 28, 2024, April 8, 2024, May 1, 2024, May 16, 2024, July 11, 2024,
August 7, 2024, September 19, 2024, September 27, 2024 and October 4, 2024 (other
than the portions of those documents not deemed to be filed pursuant to the rules promulgated
under the U.S. Exchange Act); and |
| · | the
description of the Coeur securities set forth in Exhibit 4.1 of the Coeur Annual Report,
including any amendment or report filed for the purposes of updating such description. |
Copies of the
documents incorporated herein by reference may be obtained on request without charge from SilverCrest, 570 Granville Street, Suite 501,
Vancouver, BC V6C 3P1, Attention: Lindsay Bahadir, Manager, Investor Relations & Corporate Communications, or by telephone ((604)–
694 - 1730) or email (info@silvercrestmetals.com).
Overview
Coeur is a Delaware
corporation whose principal executive offices are located at 200 South Wacker Drive, Suite 2100, Chicago, Illinois 60606. Its telephone
number is (312) 489-5800 and its website address is www.coeur.com.
Founded in 1928,
Coeur is a precious metals producer that operates certain gold and silver mines in the United States, Canada and Mexico and is headquartered
in Chicago, Illinois. Coeur’s strategy is to be a well-diversified and growing precious metals producer focused on generating sustainable,
high-quality cash flow and returns from a balanced prospective asset base in mining-friendly jurisdictions, along with a commitment to
exploration and expansions. Coeur produces and sells precious metals from four wholly owned operations: the Palmarejo gold-silver complex
in Mexico, the Rochester silver-gold mine in Nevada, the Kensington gold mine in Alaska and the Wharf gold mine in South Dakota. In addition,
Coeur wholly owns the Silvertip polymetallic critical minerals exploration project in British Columbia.
Coeur’s
strategy is guided by its purpose statement, We Pursue a Higher Standard, and three key principles: Protect our People, Places
and Planet; Develop Quality Resources, Growth and Plans; and Deliver Impactful Results Through Teamwork. Coeur conducts its business
with a proactive focus on responsible practices to positively impact the health, safety and socioeconomic status of its people and the
communities in which Coeur operates as well as be good stewards of the environment.
Coeur produces
and sells precious metals from the following operating segments:
| · | The
Palmarejo gold-silver complex, located in the State of Chihuahua in Northern Mexico, which
has been in operation since 2009. The processing facility at the Palmarejo complex is fed
by the Guadalupe, Independencia and La Nación underground mines. Exploration activities
are also carried out at the Palmarejo property package. |
| · | The
Rochester open pit heap leach silver-gold mine, located in Nevada, United States, which has
been in operation since 1986. The mine consists of the main Rochester deposit and the adjacent
Nevada Packard deposit, southwest of the Rochester mine, and the Lincoln Hill, Gold Ridge
and related exploration assets adjacent to the Rochester mine. Coeur recently completed the
construction of a significant expansion project, consisting of a new leach pad, crushing
facility, process plant and related infrastructure. |
| · | The
Kensington underground gold mine and associated milling facilities, located in Alaska, United
States. The Kensington mine began operations in 2010, consisting of the Kensington Main deposit,
Elmira deposit, and other nearby deposits and exploration targets. |
| · | The
Wharf gold mine is an open pit, heap leach gold operation located in South Dakota, United
States, which was acquired by Coeur in 2015. The property consists of several areas of gold
mineralization, which have been mined as a series of open pits. |
In addition,
Coeur operates the Silvertip polymetallic critical minerals exploration project located in northern British Columbia, Canada. The
Silvertip project suspended mining and processing activities in early 2020. While mining activities are
suspended, Coeur is (i) investing in exploration to potentially further expand the resource and extend the mine life, and (ii)
planning for an eventual mill expansion to improve the asset’s cost structure and its ability to deliver sustainable cash
flow.
The following
map shows where Coeur’s mining operations and certain exploration project are located:
| | SILVERCREST METALS INC. | H-2 |
| | | 2025 Special Meeting of Securityholders |
Dividends
Coeur has not
historically paid dividends in recent years. The DGCL, Coeur’s certificate of incorporation, Coeur’s bank credit facility
and note indenture contain certain restrictions on Coeur’s ability to declare or pay dividends for Coeur Stockholders.
Future dividends
(if any) of Coeur would depend on its earnings, financial condition, capital requirements, level of indebtedness, statutory and contractual
restrictions applicable to the payment of dividends, and other considerations that the Coeur Board deems relevant. The Coeur Board will
retain the power to amend Coeur’s dividend policy in any manner and at any time as it may deem necessary or appropriate in the
future.
Capital
Stock
As of the date
hereof, the authorized capital stock of Coeur consists of 600,000,000 Coeur Shares, $0.01 par value per share, and 10,000,000 shares
of preferred stock, $1.00 par value per share. At the special meeting of Coeur Stockholders, Coeur is proposing to amend Coeur’s
certificate of incorporation to increase the number of authorized Coeur Shares from 600,000,000 Coeur Shares to 900,000,000 Coeur Shares,
subject to and conditioned upon the receipt of the requisite approval by the Coeur Stockholders. Approval of the Coeur Charter Amendment
requires the votes cast for the Coeur Charter Amendment to exceed the votes cast against the Coeur Charter Amendment. If the Coeur Stockholders
approve the Coeur Charter Amendment and the Coeur Stock Issuance at the Coeur Stockholders’ meeting, Coeur will be authorized to issue up to
900,000,000 Coeur Shares (inclusive of any Coeur Shares already issued and outstanding). Approval of the Coeur Charter Amendment by the
Coeur Stockholders is a condition to consummating the Arrangement.
| | SILVERCREST METALS INC. | H-3 |
| | | 2025 Special Meeting of Securityholders |
The
following summary of the capital stock, Coeur’s certificate of incorporation and Coeur’s by-laws does not purport to be complete
and is qualified in its entirety by reference to the provisions of applicable Law, and Coeur’s certificate of incorporation and
Coeur’s by-laws, which are filed with the SEC.
Coeur Shares
As of January
7, 2025, 399,314,953 Coeur Shares were issued and outstanding.
Except as provided
by Law, Coeur Stockholders are entitled to one vote for each Coeur Share held of record on all matters on which stockholders are generally
entitled to vote. Holders may not cumulate their votes in elections of directors. Except as otherwise required by Law, Coeur Stockholders,
as such, are not entitled to vote on any amendment to Coeur’s certificate of incorporation (including any certificate of designations
relating to any series of preferred stock) that relates solely to the terms of any one or more outstanding series of preferred stock
if the holders of such affected series are entitled, either separately or together with the holders of one or more other such series,
to vote thereon pursuant to Coeur’s certificate of incorporation including any certificate of designations relating to any series
of preferred stock) or pursuant to the DGCL. Subject to applicable Law and preferences that may be applicable to any outstanding series
of preferred stock, dividends may be declared and paid to Coeur Stockholders out of funds legally available therefor at such times and
in such amounts as the Coeur Board, in its discretion, shall determine. All outstanding Coeur Shares are fully paid and non-assessable.
The Coeur Stockholders have no preferences, pre emption, redemption, sinking fund or conversion rights. In the event of any liquidation,
dissolution or winding-up of Coeur's affairs, Coeur Stockholders will be entitled to share rateably in Coeur's assets that are remaining
after payment or provision for payment of all of Coeur's debts and obligations and after liquidation payments to holders of outstanding
shares of preferred stock, if any.
Preferred
Stock
As of January
7, 2025, no shares of Coeur preferred stock were issued and outstanding.
Coeur’s
certificate of incorporation authorizes the Coeur Board, subject to any limitations prescribed by Law, without further stockholder approval,
to establish and to issue from time to time one or more series of preferred stock, par value $0.01 per share, covering up to an
aggregate of 10,000,000 shares of preferred stock. Each series of preferred stock will cover the number of shares and will have the powers,
preferences, rights, qualifications, limitations and restrictions determined by the Coeur Board, which may include, among others, dividend
rights, liquidation preferences, voting rights, conversion rights, sinking fund rights, pre-emptive rights and redemption rights. Except
as provided by Law or in a preferred stock designation, the holders of preferred stock will not be entitled to vote at or receive notice
of any meeting of Coeur Stockholders.
Consolidated
Capitalization
There have been
no material changes in Coeur’s consolidated capitalization since September 30, 2024, being the date of Coeur’s most recent
Quarterly Report on Form 10-Q, except as set forth in this Circular. See ‘‘Appendix J — Unaudited Pro Forma Financial
Information’’ for more information about Coeur’s consolidated capitalization both before and after giving effect
to the Arrangement.
Anti-Takeover
Effects of Provisions of Coeur's Certificate of Incorporation, Coeur’s By-laws and Delaware Law
Certain provisions
of Delaware Law, Coeur’s certificate of incorporation and Coeur’s by-laws, described below, contain provisions that could
make the following transactions more difficult: acquisitions of Coeur by means of a tender offer, a proxy contest or otherwise; or removal
of Coeur's incumbent officers and directors. These provisions may also have the effect of preventing changes in Coeur's management. It
is possible that these provisions could make it more difficult to accomplish or could deter transactions that stockholders may otherwise
consider to be in their best interest or in Coeur's best interests, including transactions that might result in a premium over the market
price for Coeur Shares.
These provisions,
summarized below, are expected to discourage coercive takeover practices and inadequate takeover bids. These provisions are also designed
to encourage persons seeking to acquire control of Coeur to first negotiate with the
Coeur Board. Coeur believes that the benefits of increased protection of Coeur's potential ability to negotiate with the proponent of
an unfriendly or unsolicited proposal to acquire or restructure Coeur outweigh the disadvantages of discouraging these proposals because,
among other things, negotiation of these proposals could result in an improvement of their terms.
| | SILVERCREST METALS INC. | H-4 |
| | | 2025 Special Meeting of Securityholders |
Certain
Voting Requirements in Coeur’s Certificate of Incorporation and Coeur’s by-laws
Coeur is subject
to the provisions of Section 203 of the DGCL regulating corporate takeovers. In general, those provisions prohibit a Delaware corporation,
including those whose securities are listed for trading on the NYSE, from engaging in any business combination with any interested stockholder
for a period of three years following the date that the stockholder became an interested stockholder, unless:
| (a) | the
transaction is approved by the board of directors before the date the interested stockholder
attained that status; |
| (b) | upon
consummation of the transaction that resulted in the stockholder becoming an interested stockholder,
the interested stockholder owned at least 85% of the voting stock of the corporation outstanding
at the time the transaction commenced; or |
| (c) | on
or after such time the business combination is approved by the board of directors and authorized
at a meeting of stockholders by at least two-thirds of the outstanding voting stock that
is not owned by the interested stockholder. |
Section 203
of the DGCL defines “business combination” to include the following:
| (a) | any
merger or consolidation involving the corporation and the interested stockholder; |
| (b) | any
sale, transfer, pledge or other disposition of 10% or more of the assets of the corporation
involving the interested stockholder; |
| (c) | subject
to certain exceptions, any transaction that results in the issuance or transfer by the corporation
of any stock of the corporation to the interested stockholder; |
| (d) | any
transaction involving the corporation that has the effect of increasing the proportionate
share of the stock of any class or series of the corporation beneficially owned by the interested
stockholder; or |
| (e) | the
receipt by the interested stockholder of the benefit of any loans, advances, guarantees,
pledges or other financial benefits provided by or through the corporation. |
In general, Section 203
defines an “interested stockholder” as any entity or person beneficially owning 15% or more of the outstanding voting stock
of the corporation and any entity or person affiliated with or controlling or controlled by any of these entities or persons.
A Delaware corporation
may "opt out" of Section 203 with an express provision in its original certificate of incorporation or an express provision
in its certificate of incorporation or by-laws resulting from amendments approved by the holders of at least a majority of the corporation's
outstanding voting shares. Coeur did not "opt out" of the provisions of Section 203. The statute could prohibit or delay
mergers or other takeover or change in control attempts and, accordingly, may discourage attempts to acquire Coeur.
For additional
information, including a comparison of rights between the DGCL and the BCBCA, please refer to Appendix L.
Coeur’s
Certificate of Incorporation and Coeur’s By-laws
Among other things,
Coeur’s certificate of incorporation and Coeur’s by-laws:
| (a) | establish
advance notice procedures with regard to stockholder proposals relating to the nomination
of candidates for election as directors or new business to be brought before meetings of
Coeur's Stockholders. These procedures provide that notice of stockholder proposals must
be timely given in writing to Coeur's corporate secretary prior to the meeting at which the
action is to be taken. Generally, to be timely, notice must be received at Coeur's principal
executive offices not less than 90 days nor more than 120 days prior to the first
anniversary date of the annual meeting for the preceding year, subject to certain exceptions.
Coeur’s by-laws specify the requirements as to form and content of all stockholders'
notices. These requirements may preclude stockholders from bringing matters before the stockholders
at an annual or special meeting; |
| (b) | provide
the Coeur Board with the ability to issue preferred stock in one or more series and to fix
the designation, powers, privileges, preferences, and relative participating, optional or
other rights, of any, of such preferred stock. This ability makes |
| | SILVERCREST METALS INC. | H-5 |
| | | 2025 Special Meeting of Securityholders |
| | it possible for the Coeur
Board to issue, without stockholder approval, preferred stock with voting or other rights
or preferences that could impede the success of any attempt to change control of Coeur. These
and other provisions may have the effect of deferring hostile takeovers or delaying changes
in control or management of Coeur; |
| (c) | provide
that the authorized number of directors may be changed only by resolution adopted by the
affirmative vote of a majority of the directors then in office, subject to the rights of
the holders of any one or more series of preferred stock to elect directors under specified
circumstances; |
| (d) | provide
that all vacancies, including newly created directorships, may, except as otherwise required
by Law, be filled by the affirmative vote of a majority of directors then in office, even
if less than a quorum, subject to the rights of the holders of any one or more series of
preferred stock then outstanding; |
| (e) | provide
that special meetings of Coeur Stockholders may only be called by the Coeur Board, the Chairman
of the Coeur Board, or the corporate secretary of Coeur upon proper written request given
by one or more stockholders of record of at least 20% of the voting power of all outstanding
Coeur Shares entitled to vote on the matter or matters to be brought before the proposed
special meeting; and |
| |
(f) |
provide that any provision
of Coeur’s by-laws can be amended or repealed at any regular or special meeting of stockholders or by the Coeur Board. |
Limitations
on Liability and Indemnification of Officers and Directors
Coeur’s
certificate of incorporation limits the liability of Coeur's directors for monetary damages for breach of their fiduciary duty as directors,
except for liability that cannot be eliminated under the DGCL. Delaware Law provides that directors of a corporation will not be personally
liable for monetary damages for breach of their fiduciary duty as directors, except for liabilities:
| (a) | for
any breach of their duty of loyalty to Coeur or Coeur Stockholders; |
| (b) | for
acts or omissions not in good faith or which involve intentional misconduct or a knowing
violation of Law; |
| (c) | for
unlawful payment of dividend or unlawful stock repurchase or redemption, as provided under
Section 174 of the DGCL; or |
| (d) | for
any transaction from which the director derived an improper personal benefit. |
Any amendment,
repeal or modification of these provisions will be prospective only and would not affect any limitation on liability of a director for
acts or omissions that occurred prior to any such amendment, repeal or modification.
Coeur’s
certificate of incorporation and Coeur’s by-laws also provide that Coeur will indemnify Coeur's directors and officers to the fullest
extent permitted by Delaware Law. Coeur’s by-laws provide that Coeur shall advance expenses incurred by any director or officer
in connection with any proceeding as to which they could be indemnified to the fullest extent authorized by the DGCL. In addition, Coeur
has entered into indemnification agreements with Coeur's current directors and executive officers. The indemnification agreements require
Coeur, among other things, to (a) indemnify these individuals to the fullest extent permitted by Coeur’s certificate of incorporation
and Coeur’s by-laws, the DGCL and any other applicable
Law
against liabilities that may arise by reason of their service to Coeur, and (b) advance expenses, to the fullest extent permitted by
Coeur’s certificate of incorporation, Coeur’s by-laws, the DGCL and any other applicable Law, incurred in connection with
any proceeding not initiated by the indemnitee as to which they could be indemnified. Coeur believes that the limitation of liability
provisions in Coeur’s certificate of incorporation, Coeur’s by-laws and the indemnification agreements will facilitate Coeur's
ability to continue to attract and retain qualified individuals to serve as future directors and executive officers.
Prior
Sales
The following
tables set forth the details regarding all issuances of Coeur Shares, including issuances of all securities convertible or exercisable
into, or, at the option of the holder, redeemable upon settlement for, Coeur Shares for the 12-month period prior to the date of the
Circular.
| | SILVERCREST METALS INC. | H-6 |
| | | 2025 Special Meeting of Securityholders |
| Date
Issued |
Type
of Security |
Number
of Securities |
Price
per Security(1) |
|
| |
| December
11, 2023(2) |
Coeur
Shares |
2,309 |
$3.11 |
|
| February
26, 2024(3) |
Performance
Share Units |
2,050,899 |
$2.77 |
|
| February
26, 2024(4) |
Coeur
Shares |
200,778 |
$2.55 |
|
| February
26, 2024(5) |
Restricted
Share Units |
1,731,110(6) |
$2.55 |
|
| February
26, 2024(2) |
Coeur
Shares |
216,821 |
$2.55 |
|
| March
8, 2024(7) |
Coeur
Shares |
7,704,725 |
$3.13 |
|
| March
15, 2024(4) |
Coeur
Shares |
23,398 |
$3.26 |
|
| March
19, 2024(8) |
Coeur
Shares |
1,771,651 |
$3.03 |
|
| April
3, 2024(9) |
Coeur
Shares |
737,210 |
$4.62 |
|
| July
15, 2024(2) |
Coeur
Shares |
55,899 |
$6.56 |
|
| August
9, 2024(3) |
Performance
Share Units |
3,568 |
$2.77 |
|
| August
9, 2024(5) |
Restricted
Share Units |
43,367(6) |
$5.44 |
|
| October
7, 2024(2) |
Coeur
Shares |
4,290 |
$6.19 |
|
Notes:
| (1) | The
price per security represented is: (i) in the case of all securities other than performance
share units, based on Coeur’s closing price on the NYSE as of the applicable issue
date; and (ii) in the case of performance share units, accounted for at the estimated grant
date fair value. |
| (2) | Issued
in connection with ordinary course director compensation. |
| (3) | Performance
share units granted. |
| (4) | Issued
in connection with vesting and release of performance share units. |
| (5) | Issued
in connection with ordinary course employee grants. |
| (6) | Amount
is net of estimated forfeiture rate of 13.75% and estimated tax withholdings of 35%. |
| (7) | Issued
in connection with flow-through shares. |
| (8) | Issued
in connection with a debt-to-equity exchange. |
| (9) | Issued
as partial consideration in respect of a dispute settlement. |
Transfer
Agent and Registrar
The
transfer agent and registrar for the Coeur Shares is Computershare Trust Company, N.A.
Trading
Price and Volumes
The Coeur Shares
are listed on the NYSE under the symbol “CDE”. The following table sets out the high and low trading prices and average daily
trading volumes for Coeur Shares on the NYSE on a monthly basis for the period from January 1, 2024 to January 7, 2025.
| | SILVERCREST METALS INC. | H-7 |
| | | 2025 Special Meeting of Securityholders |
| Month |
High
($) |
Low
($) |
Volume |
| 2024 |
|
|
|
| January |
3.34 |
2.52 |
144,260,399 |
| February |
2.86 |
2.42 |
111,124,618 |
| March |
3.79 |
2.54 |
141,615,996 |
| April |
5.47 |
4.03 |
234,792,101 |
| May |
6.05 |
4.36 |
161,779,861 |
| June |
6.03 |
5.23 |
136,717,979 |
| July |
6.82 |
5.40 |
117,540,912 |
| August |
6.63 |
4.57 |
161,122,929 |
| September |
7.72 |
5.20 |
187,806,555 |
| October |
7.52 |
6.03 |
230,468,536 |
| November |
6.78 |
5.49 |
206,025636 |
| December |
7.44 |
5.53 |
199,196,965 |
| 2025 |
|
|
|
| January
1 to January 7 |
6.44 |
5.84 |
46,074,870 |
Risk
Factors
An investment
in the securities of Coeur and the completion of the Arrangement are subject to certain risks. In addition to considering the other information
in this Circular, including the risk factors relating to the Arrangement set forth under “Risk Factors” in this Circular,
readers should carefully consider the risk factors described under the heading “Risk Factors” in the Coeur Annual Report
which is incorporated by reference in this Circular. If any of the identified risks were to materialize, Coeur’s business, financial
position, results and/or future operations may be materially affected. The risk factors identified in this Circular and the documents
incorporated by reference are not exhaustive and other factors may arise in the future that are currently not foreseen by management
of Coeur that may present additional risks in the future.
Interests
of Experts
The Coeur Annual
Report, incorporated by reference to this Circular, has been audited by Grant Thornton LLP, as set forth in their report thereon. Grant
Thornton LLP has advised Coeur that it is independent of Coeur as required by the Public Company Accounting Oversight Board (PCAOB) and
has complied with the American Institute of Certified Public Accountants (AICPA) Code of Professional Conduct and SEC rules on auditor
independence.
Christopher Pascoe
is a “qualified person” under Regulation S-K 1300 of the U.S. Exchange Act and is an employe of Coeur. Mr. Pascoe has reviewed
and approved all scientific and technical information relating to Coeur contained in this Circular or in a document incorporated by reference
herein. To Coeur’s knowledge, Mr. Pascoe holds less than 1% of any of Coeur’s securities or any securities of Coeur’s
associates or affiliates as of the date hereof.
| | SILVERCREST METALS INC. | H-8 |
| | | 2025 Special Meeting of Securityholders |
APPENDIX
I
INFORMATION CONCERNING THE COMBINED COMPANY
Notice
to Reader
The following
information about Coeur following completion of the Arrangement should be read in conjunction with documents incorporated by reference
in this Circular and the information concerning Coeur and SilverCrest, as applicable, appearing elsewhere in this Circular. See Appendix
H “Information Concerning Coeur” and “Information Concerning SilverCrest” in this Circular.
For further information regarding Coeur or SilverCrest, please refer to the filings under their respective issuer profiles on EDGAR at
www.sec.gov or SEDAR+ at www.sedarplus.ca as applicable.
Forward-Looking
Statements
Certain statements
contained in this Appendix I, and in certain documents incorporated by reference in this Appendix I, constitute forward-looking
statements or information within the meaning of applicable Canadian Securities Laws. Such forward-looking statements relate to future
events or Coeur’s and SilverCrest’s future performance. See “Forward-Looking Information” in this Circular.
General
The Arrangement
will result in a strategic business combination of Coeur and SilverCrest, pursuant to which Coeur (through Coeur Canadian Sub) will acquire
all of the issued and outstanding SilverCrest Shares in exchange for the issuance of Coeur Shares. In connection with the Arrangement,
Shareholders (other than Dissenting Shareholders) will receive consideration of 1.6022 Coeur Shares for each SilverCrest Share they hold.
Upon completion of the Arrangement, existing Coeur Stockholders and former Shareholders are expected to own approximately 63% and 37%
of the outstanding common stock of the Combined Company, respectively, in each case, based on the number of Coeur Shares and SilverCrest
Shares issued and outstanding as of October 3, 2024, the date of the Arrangement Agreement.
Following completion
of the Arrangement, Coeur will continue to be the publicly traded parent company of the combined business with the Coeur Shares traded
on the NYSE, and SilverCrest will indirectly, through Coeur Canadian Sub, be an indirect wholly owned subsidiary of Coeur. The Combined
Company will remain a corporation governed by the laws of the state of Delaware. Coeur’s head office will continue to be located
at 200 South Wacker Drive, Suite 2100, Chicago, IL 60606. Coeur will continue to be a reporting issuer in each of the provinces and territories
of Canada. Subject to certain exceptions, Coeur will continue to be generally exempt from Canadian statutory financial and other continuous
and timely reporting requirements, including the requirement for insiders of Coeur to file reports with respect to trades of Coeur securities,
provided that Coeur complies with the requirements of applicable U.S. securities laws and U.S. market requirements in respect of all
financial and other continuous and timely reporting matters, and Coeur files with the relevant Canadian securities regulatory authorities
copies of its documents filed with the SEC under the U.S. Exchange Act.
Combined
Company Capital Structure
At the special
meeting of Coeur Stockholders, Coeur is proposing to amend Coeur’s certificate of incorporation to increase the number of authorized
Coeur Shares from 600,000,000 Coeur Shares to 900,000,000 Coeur Shares, subject to and conditioned upon the receipt of the requisite
approval by the Coeur Stockholders. Coeur is also authorized to issue up to 10,000,000 shares of preferred stock. Approval of the Coeur
Charter Amendment requires the votes cast for the Coeur Charter Amendment to exceed the votes cast against the Coeur Charter Amendment.
If the Coeur Stockholders approve the Coeur Charter Amendment and the Coeur Stock Issuance at the Coeur Stockholders’ meeting,
the Combined Company will be authorized to issue up to 900,000,000 Coeur Shares (inclusive of any Coeur Shares already issued and outstanding).
The number of issued and outstanding capital stock of the Combined Company will increase following the completion of the Arrangement
as a result of the issuance of approximately 239,029,844 Coeur Shares pursuant to the Arrangement (based on the issued and outstanding
SilverCrest Shares as of the Record Date). Following completion of the Arrangement, it is estimated that there will be approximately
638,344,797 Coeur Shares issued and outstanding (based on the issued and outstanding Coeur Shares as of the Record Date, and assuming
that 239,029,844 Coeur Shares will be issued in the Arrangement).
As of the Record
Date, there were 2,365,586 SilverCrest Options issued and outstanding. As part of the Arrangement, the SilverCrest Options will be exchanged
for Coeur Replacement Options, representing approximately 0.95% of the outstanding Coeur Shares (on a fully diluted basis and based on
the issued and outstanding Coeur Shares as of the Record Date).
| | SILVERCREST METALS INC. | I-1 |
| | | 2025 Special Meeting of Securityholders |
Except as provided
by Law, Coeur Stockholders are entitled to one vote for each Coeur Share held of record on all matters on which Coeur Stockholders are
generally entitled to vote. Holders may not cumulate their votes in elections of directors. Subject to applicable Law, covenants set
forth in Coeur’s agreements governing its outstanding indebtedness and outstanding senior notes, and preferences that may be applicable
to any outstanding series of preferred stock, dividends may be declared and paid to Coeur Stockholders out of funds legally available
therefor at such times and in such amounts as the board of directors of Coeur, in its discretion, shall determine. In the event of any
liquidation, dissolution or winding-up of Coeur’s affairs, Coeur Stockholders will be entitled to share rateably in Coeur’s
assets that are remaining after payment or provision for payment of all of Coeur's debts and obligations and after liquidation payments
to holders of outstanding shares of preferred stock, if any. There are no pre-emption, redemption, sinking fund or conversion rights
applicable to the Coeur Shares.
Coeur Shares
are shares of common stock, par value $0.01 per share, in the capital of Coeur. Share certificates are evidence of legal title to Coeur
Shares and should be kept in safe custody; loss, defacement or destruction will necessitate a process of issuing a replacement certificate
which may entail cost, time and appropriate indemnification and/or insurance. Coeur Shares are listed and traded in U.S. dollars on the
NYSE only. Accordingly, investors who wish to trade Coeur Shares on the open market must do so on the NYSE. Such trades must be undertaken
through a broker entitled to trade on the NYSE. The Canadian dollar value of Coeur Shares will depend on the prevailing C$:US$ exchange
rate from time to time.
Description
of the Business
The Combined
Company will be a well-diversified precious metals mining company, with wholly owned operations in the United States, Canada and Mexico.
The Combined Company will focus on generating sustainable, high-quality cash flow and returns from a balanced, prospective asset base
in mining-friendly jurisdictions, along with its commitment to exploration and expansions. Set out below is a list of the Combined Company’s
material mineral projects, all of which will be 100% owned, directly or indirectly, by Coeur upon completion of the Arrangement, unless
otherwise indicated:
Coeur mineral
projects:
| · | The
Palmarejo gold-silver complex, located in the State of Chihuahua in Northern Mexico, which
has been in operation since 2009. The processing facility at the Palmarejo complex is fed
by the Guadalupe, Independencia and La Nacion underground mines. Exploration activities are
also carried out at the Palmarejo property. |
| · | The
Rochester open pit heap leach silver-gold mine, located in Nevada, United States, which has
been in operation since 1986. The mine consists of the main Rochester deposit and the adjacent
Nevada Packard deposit, southwest of the Rochester mine, and the Lincoln Hill, Gold Ridge
and related exploration assets adjacent to the Rochester mine. Coeur recently completed a
significant expansion project in 2023, consisting of a new leach pad, crushing facility,
process plant and related infrastructure. |
| · | The
Kensington underground gold mine and associated milling facilities, located in Alaska, United
States. The Kensington mine began operations in 2010, consisting of the Kensington Main deposit,
Raven deposit, and other nearby deposits and exploration targets. |
| · | The
Wharf gold mine is an open pit, heap leach gold operation located in South Dakota, United
States, which has been in operation since 1982. The property consists of several areas of
gold mineralization, which have been mined as a series of open pits. |
In addition,
the Combined Company will continue to operate the Silvertip polymetallic critical minerals exploration project located in northern British
Columbia, Canada. The Silvertip project suspended mining and processing activities in early 2020 and Coeur has since started to evaluate
a larger potential expansion.
SilverCrest mineral
projects:
| · | The
Las Chispas silver-gold mine located in Sonora, Mexico. The property consists of 28 concessions
totalling 1400.96 hectares. The Las Chispas operation commenced commercial production in
November 2022. |
| | SILVERCREST METALS INC. | I-2 |
| | | 2025 Special Meeting of Securityholders |
In addition to the Las Chispas operation, the
Combined Company will continue to operate a portfolio of three other mineral exploration properties located in Sonora, Mexico, comprised
of the El Picacho, Cruz de Mayo, and Angel de Plata properties.
Consolidated
Capitalization
There have been
no material changes in Coeur’s consolidated capitalization since September 30, 2024, being the date of Coeur’s most recent
Quarterly Report on Form 10-Q, except as set forth in this Circular. See ‘‘Appendix J — Unaudited Pro Forma Financial
Information’’ for more information about Coeur’s consolidated capitalization both before and after giving effect
to the Arrangement.
Dividends
Each of SilverCrest
and Coeur have not historically paid dividends in recent years. The DGCL, Coeur’s certificate of incorporation, Coeur’s bank
credit facility and note indenture contain certain restrictions on the Combined Company’s ability to declare or pay dividends for
Coeur Stockholders following the Arrangement.
Future dividends
(if any) of the Combined Company would depend on its earnings, financial condition, capital requirements, level of indebtedness, statutory
and contractual restrictions applicable to the payment of dividends, and other considerations that the board of directors of the Combined
Company deems relevant. The Coeur Board will retain the power to amend Coeur’s dividend policy in any manner and at any time as
it may deem necessary or appropriate in the future.
Unaudited
Pro Forma Condensed Combined Financial Statements
For selected
unaudited pro forma condensed combined financial statements of Coeur giving effect to the Arrangement, see Appendix J “Unaudited
Pro Forma Financial Information” attached to this Circular.
Directors
and Executive Officers of the Combined Company
Board of
Directors
Coeur has agreed
with SilverCrest that it will take all actions necessary to ensure that, at the Effective Time, N. Eric Fier and Pierre Beaudoin shall
be appointed to the Coeur Board and at the next annual general meeting of Coeur held to consider the election of directors that occurs
following the Effective Date, N. Eric Fier and Pierre Beaudoin shall be nominated by Coeur for election as directors of Coeur, provided
that (i) such nominees meet any applicable qualification requirements to serve as directors under applicable Laws, and (ii) such nominees
have each delivered to Coeur a consent to act as a director of Coeur. Following completion of the Arrangement, it is expected that the
Combined Company’s board of directors will consist of ten directors, comprised of: Mitchell J. Krebs, J. Kenneth Thompson, Linda
L. Adamany, Paramita Das, Randolph E. Gress, Jeane L. Hull, Eduardo Luna and Robert E. Mellor from Coeur, and N. Eric Fier and Pierre
Beaudoin.
Information about
the members of the Combined Company’s board of directors who are currently directors of SilverCrest is in the Company AIF, which
is incorporated by reference in this Circular. Information about the members of the Combined Company’s board of directors who are
currently directors of Coeur is in Coeur’s Proxy Statement filed on Schedule 14A and dated April 4, 2024, which is incorporated
by reference in this Circular. The members of the board of directors of the Combined Company will hold office until the first annual
meeting of Coeur Stockholders after the Effective Time, or until their respective successors have been duly elected or appointed.
Executive
Officers
Following completion
of the Arrangement, Coeur anticipates the current members of its management team shall continue to serve as officers of the Combined
Company: Mitchell J. Krebs, Chairman, President & Chief Executive Officer, Thomas S. Whelan, Senior Vice President & Chief Financial
Officer, Michael Routledge, Senior Vice President & Chief Operating Officer,
Casey M. Nault, Senior Vice President, General Counsel & Chief ESG Officer, and Emilie C. Schouten, Senior Vice President & Chief
Human Resources Officer and Aoife McGrath, Senior Vice President, Exploration.
| | SILVERCREST METALS INC. | I-3 |
| | | 2025 Special Meeting of Securityholders |
Indebtedness
of Directors, Officers and Other Management
As of the date
hereof, none of the proposed directors, officers or other members of management or promoters of the Combined Company, nor any of their
associates or affiliates is indebted to SilverCrest or Coeur, nor has any indebtedness of any such person been the subject of a guarantee,
support agreement, letter of credit or other similar arrangement or understanding provided by SilverCrest or Coeur.
Principal
Holders of Coeur Shares Upon Completion of the Arrangement
After giving
effect to the Arrangement and based on certain assumptions, to the knowledge of the directors and executive officers of Coeur and SilverCrest,
as of the date hereof, it is not anticipated that any person will own of record or beneficially own, directly or indirectly, or exercise
control or direction over voting securities carrying more than 10% of the voting rights attached to the Coeur Shares.
Auditors,
Transfer Agent and Registrar
Auditors
Following the
Arrangement, the auditors of Coeur will continue to be Grant Thornton LLP, located in Chicago, Illinois, which are the current auditors
of Coeur.
Registrar
and Transfer Agent
Computershare
Trust Company, N.A. will continue to be the registrar and transfer agent for the Coeur Shares following the Arrangement.
Material
Contracts
Other than as
disclosed in this Circular or in the documents incorporated by reference herein with respect to Coeur and SilverCrest, there are no contracts
to which the combined business will be a party to following completion of the Arrangement that can reasonably be regarded as material
to a proposed investor, other than contracts entered into by Coeur and SilverCrest in the ordinary course of business. For a description
of the material contracts of SilverCrest, please refer to the Company AIF, which is incorporated by reference in this Circular. For a
description of the material contracts of Coeur, please refer to the following documents, each of which is incorporated by reference in
this Circular:
| · | the
Coeur Annual Report; |
| · | Coeur’s
Quarterly Reports on Form 10-Q for the quarters ended March 31, 2024, June 30, 2024 and September
30, 2024, filed with the SEC on May 1, 2024, August 7, 2024 and November 6, 2024, respectively;
and |
| · | Coeur’s
Current Reports on Form 8-K filed with the SEC on January 29, 2024, February
21, 2024, February 27, 2024, March 29, 2024, April 8, 2024, May 1, 2024, May 16, 2024, July
11, 2024, August 7, 2024, September 19, 2024, September 27, 2024, October 4, 2024 and November
6, 2024 (excluding any information furnished under Item 2.02 or 7.01 on any Current Report
on Form 8-K). |
See Appendix
H “Information Concerning Coeur” and “Information Concerning SilverCrest” in this Circular.
Risk
Factors
The business
and operations of the Combined Company following completion of the Arrangement will continue to be subject to the risks currently faced
by Coeur and SilverCrest, as well as certain risks unique to the Combined Company following completion of the Arrangement. Readers are
cautioned that such risk factors are not exhaustive and additional risks and uncertainties, including those currently unknown or considered
immaterial to Coeur and SilverCrest, may also adversely
affect Coeur or SilverCrest prior to the Arrangement or the Combined Company following completion of the Arrangement. These risk factors
should be considered in
| | SILVERCREST METALS INC. | I-4 |
| | | 2025 Special Meeting of Securityholders |
conjunction with the other information included in this Circular, including the documents incorporated by reference
herein, and documents filed by Coeur and SilverCrest pursuant to applicable Laws from time to time.
See “Risk
Factors” in this Circular, Appendix H “Information Concerning Coeur” and “Information Concerning
SilverCrest” in this Circular.
| | SILVERCREST METALS INC. | I-5 |
| | | 2025 Special Meeting of Securityholders |
APPENDIX
J
UNAUDITED PRO FORMA FINANCIAL INFORMATION
The following unaudited
pro forma condensed combined financial information (“Unaudited Pro Forma Financial Information”) has been prepared
based on the historical audited and unaudited consolidated financial statements of SilverCrest and Coeur, as indicated below, and is
intended to provide information about how the Arrangement might have affected Coeur’s historical financial statements.
The unaudited pro forma
condensed combined statements of operations (“Unaudited Pro Forma Statement of Operations”) for the year ended December 31,
2023 and the nine months ended September 30, 2024, combines the respective historical audited and unaudited consolidated income
statements of SilverCrest, with the historical audited and unaudited consolidated statements of operations of Coeur for the corresponding
periods, as if the Arrangement had occurred on January 1, 2023. The unaudited pro forma condensed combined balance sheet (“Unaudited
Pro Forma Balance Sheet”) as of September 30, 2024, combines the historical unaudited consolidated statement of financial
position of SilverCrest and the historical unaudited consolidated balance sheet of Coeur each as of September 30, 2024, as if the
Arrangement had occurred on September 30, 2024.
The Unaudited Pro Forma
Financial Information has been developed from and should be read in conjunction with:
| · | the
historical audited consolidated financial statements of SilverCrest for the year ended December
31, 2023, included in SilverCrest’s annual report on Form 40-F, filed with the SEC
on March 11, 2024; |
| · | the
historical unaudited condensed interim consolidated financial statements of SilverCrest for
the nine months ended September 30, 2024, included in SilverCrest’s interim report
on Form 6-K, filed with the SEC on November 12, 2024; |
| · | the
accompanying notes to the Unaudited Pro Forma Financial Information; |
| · | the
historical audited consolidated financial statements of Coeur for the year ended December
31, 2023, included in Coeur’s annual report on Form 10-K, filed with the SEC on February
21, 2023; |
| · | the
historical unaudited condensed consolidated financial statements of Coeur for the nine months
ended September 30, 2024, included in Coeur’s quarterly report on Form 10-Q, filed
with the SEC on November 6, 2024; and |
| · | other
information relating to SilverCrest and Coeur contained in or incorporated by reference into
this document. See “Other Information – Additional Information.”
|
The Unaudited Pro Forma
Financial Information is presented using the acquisition method of accounting, with Coeur as the acquirer of SilverCrest. See “Management
Information Circular – Presentation of Financial Information and Currency Exchange Rates”. Under the acquisition method
of accounting, the purchase price is allocated to the underlying tangible and intangible assets acquired and liabilities assumed of SilverCrest
based on their respective fair market values with any excess purchase price allocated to goodwill.
The Unaudited Pro Forma
Financial Information is presented for informational purposes only. The information has been prepared in accordance with Article 11
of Regulation S-X of the SEC as amended by the final rule, Release No. 33-10786 “Amendments to Financial Disclosures about
Acquired and Disposed Businesses,” using the assumptions set forth in the notes to the Unaudited Pro Forma Financial Information.
The information has been adjusted to include estimated Arrangement accounting adjustments, prepared by Coeur management in accordance
with the recognition and measurement principles of GAAP.
The information is not
necessarily indicative of the financial position and results of operations that actually would have been achieved had the Arrangement
occurred as of the dates indicated herein, nor do they purport to project the future financial position and operating results of the
combined company. The Unaudited Pro Forma Financial Information also does not reflect the costs of any integration activities or cost
savings or synergies expected to be achieved as a result of the Arrangement, which are described in the section entitled “Reasons
for the Arrangement”, and, accordingly, do not attempt to predict or suggest future results.
| | SILVERCREST METALS INC. | J-1 |
| | | 2025 Special Meeting of Securityholders |
Coeur Mining, Inc.
Unaudited Pro Forma
Condensed Combined Balance Sheet
As of September 30,
2024
| In
thousands, except share data |
|
|
Historical
Coeur |
|
|
Reclassified
Historical
SilverCrest
(Note 2) |
|
|
IFRS Accounting
Standards to
GAAP
and
Accounting
Policy
Adjustments
(Note 3) |
|
|
(Note) |
|
|
Arrangement
Accounting
Adjustments
(Note 4) |
|
|
(Note) |
|
|
Pro Forma
Combined |
| ASSETS |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| CURRENT ASSETS |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Cash and cash equivalents |
|
|
$76,916 |
|
|
$120,864 |
|
|
$— |
|
|
|
|
|
$— |
|
|
|
|
|
$197,780
|
| Receivables |
|
|
30,165 |
|
|
14,133 |
|
|
— |
|
|
|
|
|
— |
|
|
|
|
|
44,298
|
| Inventory |
|
|
74,727 |
|
|
59,267 |
|
|
— |
|
|
|
|
|
81,158 |
|
|
4(b) |
|
|
215,152
|
| Ore on leach pads |
|
|
148,331 |
|
|
— |
|
|
— |
|
|
|
|
|
— |
|
|
|
|
|
148,331
|
| Bullion |
|
|
— |
|
|
37,374 |
|
|
— |
|
|
|
|
|
— |
|
|
|
|
|
37,374
|
| Prepaid expenses and
other |
|
|
15,833 |
|
|
7,671 |
|
|
— |
|
|
|
|
|
— |
|
|
|
|
|
23,504
|
| |
|
|
345,972 |
|
|
239,309 |
|
|
— |
|
|
|
|
|
81,158 |
|
|
|
|
|
666,439
|
| NON-CURRENT ASSETS |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Property, plant and equipment
and mining properties, net |
|
|
1,759,454 |
|
|
264,345 |
|
|
(11,134) |
|
|
3(a)(b) |
|
|
1,097,621 |
|
|
4(c) |
|
|
3,110,286
|
| Goodwill |
|
|
— |
|
|
— |
|
|
— |
|
|
|
|
|
446,151 |
|
|
4(g) |
|
|
446,151
|
| Ore on leach pads |
|
|
34,598 |
|
|
— |
|
|
— |
|
|
|
|
|
— |
|
|
|
|
|
34,598
|
| Restricted assets |
|
|
9,339 |
|
|
— |
|
|
— |
|
|
|
|
|
— |
|
|
|
|
|
9,339
|
| Deferred tax assets |
|
|
— |
|
|
1,031 |
|
|
5,740 |
|
|
3(a)(c) |
|
|
— |
|
|
|
|
|
6,771
|
| Receivables |
|
|
20,161 |
|
|
16,953 |
|
|
— |
|
|
|
|
|
— |
|
|
|
|
|
37,114
|
| Other |
|
|
58,276 |
|
|
5,428 |
|
|
— |
|
|
|
|
|
— |
|
|
|
|
|
63,704
|
| TOTAL ASSETS |
|
|
$2,227,800 |
|
|
$527,066 |
|
|
$(5,394) |
|
|
|
|
|
$1,624,930 |
|
|
|
|
|
$4,374,402
|
| LIABILITIES AND STOCKHOLDERS’
EQUITY |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| CURRENT LIABILITIES |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Accounts payable |
|
|
$126,387 |
|
|
$6,816 |
|
|
$— |
|
|
|
|
|
$— |
|
|
|
|
|
$133,203
|
| Accrued liabilities and
other |
|
|
153,285 |
|
|
41,811 |
|
|
— |
|
|
|
|
|
19,124 |
|
|
4(a)(e) |
|
|
214,220
|
| Debt |
|
|
27,458 |
|
|
330 |
|
|
— |
|
|
|
|
|
— |
|
|
|
|
|
27,788
|
| Reclamation |
|
|
10,954 |
|
|
— |
|
|
— |
|
|
|
|
|
— |
|
|
|
|
|
10,954
|
| |
|
|
318,084 |
|
|
48,957 |
|
|
— |
|
|
|
|
|
19,124 |
|
|
|
|
|
386,165
|
| NON-CURRENT LIABILITIES |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Debt |
|
|
577,725 |
|
|
660 |
|
|
— |
|
|
|
|
|
— |
|
|
|
|
|
578,385
|
| Reclamation |
|
|
211,136 |
|
|
6,614 |
|
|
4,828 |
|
|
3(b) |
|
|
— |
|
|
|
|
|
222,578
|
| Deferred tax liabilities |
|
|
6,755 |
|
|
6,656 |
|
|
— |
|
|
|
|
|
373,931 |
|
|
4(e) |
|
|
387,342
|
| Other long-term liabilities |
|
|
30,950 |
|
|
— |
|
|
2,698 |
|
|
3(c) |
|
|
— |
|
|
|
|
|
33,648
|
| |
|
|
826,566 |
|
|
13,930 |
|
|
7,526 |
|
|
|
|
|
373,931 |
|
|
|
|
|
1,221,953
|
| COMMITMENTS AND CONTINGENCIES |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| STOCKHOLDERS’ EQUITY |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Common stock, par value
$0.01 per share |
|
|
3,993 |
|
|
— |
|
|
— |
|
|
|
|
|
240 |
|
|
4(f) |
|
|
4,233
|
| Additional paid-in capital |
|
|
4,179,270 |
|
|
430,216 |
|
|
— |
|
|
|
|
|
1,265,702 |
|
|
4(f) |
|
|
5,875,188
|
| Currency translation
adjustment |
|
|
— |
|
|
(3,538) |
|
|
— |
|
|
|
|
|
3,538 |
|
|
4(f) |
|
|
—
|
| Accumulated other comprehensive
income (loss) |
|
|
— |
|
|
— |
|
|
— |
|
|
|
|
|
— |
|
|
|
|
|
—
|
| Accumulated deficit |
|
|
(3,100,113) |
|
|
37,501 |
|
|
(12,920) |
|
|
|
|
|
(37,605) |
|
|
4(f) |
|
|
(3,113,137)
|
| |
|
|
1,083,150 |
|
|
464,179 |
|
|
(12,920) |
|
|
|
|
|
1,231,875 |
|
|
|
|
|
2,766,284
|
| TOTAL LIABILITIES AND
STOCKHOLDERS’ EQUITY |
|
|
$2,227,800 |
|
|
$527,066 |
|
|
$(5,394) |
|
|
|
|
|
$1,624,930 |
|
|
|
|
|
$4,374,402 |
| | SILVERCREST METALS INC. | J-2 |
| | | 2025 Special Meeting of Securityholders |
Coeur Mining, Inc.
Unaudited Pro Forma
Condensed Combined Statement of Operations
For the Nine Months
Ended September 30, 2024
| In
thousands |
|
|
Historical
Coeur |
|
|
Reclassified
Historical
SilverCrest
(Note 2) |
|
|
IFRS Accounting
Standards to
GAAP
and
Accounting
Policy
Adjustments
(Note 3) |
|
|
(Note) |
|
|
Arrangement
Accounting
Adjustments
(Note 4) |
|
|
(Note) |
|
|
Pro Forma
Combined |
| Revenue |
|
|
$748,562 |
|
|
$216,758 |
|
|
$— |
|
|
|
|
|
$— |
|
|
|
|
|
$965,320
|
| COSTS AND EXPENSES |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Costs applicable to sales(1) |
|
|
447,456 |
|
|
65,016 |
|
|
282 |
|
|
3(c) |
|
|
43 |
|
|
4(d) |
|
|
512,797
|
| Amortization |
|
|
88,441 |
|
|
25,744 |
|
|
3,177 |
|
|
3(a)(b) |
|
|
94,120 |
|
|
4(c) |
|
|
211,482
|
| General and administrative |
|
|
36,611 |
|
|
15,017 |
|
|
— |
|
|
|
|
|
— |
|
|
|
|
|
51,628
|
| Exploration |
|
|
42,932 |
|
|
963 |
|
|
— |
|
|
|
|
|
— |
|
|
|
|
|
43,895
|
| Pre-development, reclamation,
and other |
|
|
35,401 |
|
|
3,817 |
|
|
524 |
|
|
3(b) |
|
|
— |
|
|
|
|
|
39,742
|
| Total costs and expenses |
|
|
650,841 |
|
|
110,557 |
|
|
3,983 |
|
|
|
|
|
94,163 |
|
|
|
|
|
859,544
|
| OTHER INCOME (EXPENSE),
NET |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Gain (loss) on debt extinguishment |
|
|
417 |
|
|
— |
|
|
— |
|
|
|
|
|
— |
|
|
|
|
|
417
|
| Fair value adjustments,
net |
|
|
— |
|
|
(2,232) |
|
|
— |
|
|
|
|
|
— |
|
|
|
|
|
(2,232)
|
| Interest expense, net
of capitalized interest |
|
|
(39,389) |
|
|
(520) |
|
|
— |
|
|
|
|
|
— |
|
|
|
|
|
(39,909)
|
| Other, net |
|
|
11,329 |
|
|
114 |
|
|
423 |
|
|
3(c) |
|
|
— |
|
|
|
|
|
11,866
|
| Total other income (expense),
net |
|
|
(27,643) |
|
|
(2,638) |
|
|
423 |
|
|
|
|
|
— |
|
|
|
|
|
(29,858)
|
| Income (loss) before
income and mining taxes |
|
|
70,078 |
|
|
103,563 |
|
|
(3,560) |
|
|
|
|
|
(94,163) |
|
|
|
|
|
75,918
|
| Income and mining tax
(expense) benefit |
|
|
(49,030) |
|
|
(53,697) |
|
|
1,070 |
|
|
3(a)(b)(c) |
|
|
24,059 |
|
|
4(e) |
|
|
(77,598)
|
| NET INCOME (LOSS) |
|
|
$21,048 |
|
|
$49,866 |
|
|
$(2,490) |
|
|
|
|
|
$(70,104) |
|
|
|
|
|
$(1,680)
|
| OTHER COMPREHENSIVE INCOME
(LOSS): |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Change in fair value
of derivative contracts designated as cash flow hedges |
|
|
(18,507) |
|
|
— |
|
|
— |
|
|
|
|
|
— |
|
|
|
|
|
(18,507)
|
| Reclassification adjustments
for realized (gain) loss on cash flow hedges |
|
|
17,176 |
|
|
— |
|
|
— |
|
|
|
|
|
— |
|
|
|
|
|
17,176
|
| Other comprehensive income
(loss) |
|
|
(1,331) |
|
|
— |
|
|
— |
|
|
|
|
|
— |
|
|
|
|
|
(1,331)
|
| COMPREHENSIVE INCOME
(LOSS) |
|
|
$19,717 |
|
|
$49,866 |
|
|
$(2,490) |
|
|
|
|
|
$(70,104) |
|
|
|
|
|
$(3,011)
|
| NET INCOME (LOSS) PER
SHARE |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Basic income (loss) per
share: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Basic |
|
|
$0.05 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
4(h) |
|
|
$0.00
|
| Diluted |
|
|
$0.05 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
4(h) |
|
|
$0.00 |
(1) Excludes
amortization
| | SILVERCREST METALS INC. | J-3 |
| | | 2025 Special Meeting of Securityholders |
Coeur Mining, Inc.
Unaudited Pro Forma
Condensed Combined Statement of Operations
For the Year Ended
December 31, 2023
| In
thousands |
|
|
Historical
Coeur |
|
|
Reclassified
Historical
SilverCrest
(Note 2) |
|
|
IFRS Accounting
Standards to
GAAP
and
Accounting
Policy
Adjustments
(Note 3) |
|
|
(Note) |
|
|
Arrangement
Accounting
Adjustments
(Note 4) |
|
|
(Note) |
|
|
Pro Forma
Combined |
| Revenue |
|
|
$821,206 |
|
|
$245,130 |
|
|
$— |
|
|
|
|
|
$— |
|
|
|
|
|
$1,066,336
|
| COSTS AND EXPENSES |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Costs applicable to sales(1) |
|
|
632,896 |
|
|
75,476 |
|
|
339 |
|
|
3(c) |
|
|
57,040 |
|
|
4(d) |
|
|
765,751
|
| Amortization |
|
|
99,822 |
|
|
21,348 |
|
|
10,476 |
|
|
3(a)(b) |
|
|
146,636 |
|
|
4(b)(c) |
|
|
278,282
|
| General and administrative |
|
|
41,605 |
|
|
15,756 |
|
|
— |
|
|
|
|
|
— |
|
|
|
|
|
57,361
|
| Exploration |
|
|
30,962 |
|
|
726 |
|
|
— |
|
|
|
|
|
— |
|
|
|
|
|
31,688
|
| Pre-development, reclamation,
and other |
|
|
54,636 |
|
|
493 |
|
|
749 |
|
|
3(b) |
|
|
13,024 |
|
|
4(a) |
|
|
68,902
|
| Total costs and expenses |
|
|
859,921 |
|
|
113,799 |
|
|
11,564 |
|
|
|
|
|
216,700 |
|
|
|
|
|
1,201,984
|
| OTHER INCOME (EXPENSE),
NET |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Gain (loss) on debt extinguishment |
|
|
3,437 |
|
|
— |
|
|
— |
|
|
|
|
|
— |
|
|
|
|
|
3,437
|
| Fair value adjustments,
net |
|
|
3,384 |
|
|
735 |
|
|
— |
|
|
|
|
|
— |
|
|
|
|
|
4,119
|
| Interest expense, net
of capitalized interest |
|
|
(29,099) |
|
|
(2,220) |
|
|
— |
|
|
|
|
|
— |
|
|
|
|
|
(31,319)
|
| Other, net |
|
|
(7,463) |
|
|
(6,600) |
|
|
(334) |
|
|
3(c) |
|
|
— |
|
|
|
|
|
(14,397)
|
| Total other income (expense),
net |
|
|
(29,741) |
|
|
(8,085) |
|
|
(334) |
|
|
|
|
|
— |
|
|
|
|
|
(38,160)
|
| Income (loss) before
income and mining taxes |
|
|
(68,456) |
|
|
123,246 |
|
|
(11,898) |
|
|
|
|
|
(216,700) |
|
|
|
|
|
(173,808)
|
| Income and mining tax
(expense) benefit |
|
|
(35,156) |
|
|
(6,526) |
|
|
3,330 |
|
|
3(a)(b)(c) |
|
|
58,063 |
|
|
4(e) |
|
|
19,711
|
| NET INCOME (LOSS) |
|
|
$(103,612) |
|
|
$116,720 |
|
|
$(8,568) |
|
|
|
|
|
$(158,637) |
|
|
|
|
|
$(154,097)
|
| OTHER COMPREHENSIVE INCOME
(LOSS): |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Change in fair value
of derivative contracts designated as cash flow hedges |
|
|
(318) |
|
|
— |
|
|
— |
|
|
|
|
|
— |
|
|
|
|
|
(318)
|
| Currency translation
adjustment |
|
|
— |
|
|
10,255 |
|
|
— |
|
|
|
|
|
— |
|
|
|
|
|
10,255
|
| Reclassification adjustments
for realized (gain) loss on cash flow hedges |
|
|
(10,694) |
|
|
— |
|
|
— |
|
|
|
|
|
— |
|
|
|
|
|
(10,694)
|
| Other comprehensive income
(loss) |
|
|
(11,012) |
|
|
10,255 |
|
|
— |
|
|
|
|
|
— |
|
|
|
|
|
(757)
|
| COMPREHENSIVE INCOME
(LOSS) |
|
|
$(114,624) |
|
|
$126,975 |
|
|
$(8,568) |
|
|
|
|
|
$(158,637) |
|
|
|
|
|
$(154,854)
|
| | SILVERCREST METALS INC. | J-4 |
| | | 2025 Special Meeting of Securityholders |
| In
thousands |
|
|
Historical
Coeur |
|
|
Reclassified
Historical
SilverCrest
(Note 2) |
|
|
IFRS Accounting
Standards to
GAAP
and
Accounting
Policy
Adjustments
(Note 3) |
|
|
(Note) |
|
|
Arrangement
Accounting
Adjustments
(Note 4) |
|
|
(Note) |
|
|
Pro Forma
Combined
|
| NET INCOME (LOSS) PER
SHARE |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Basic income (loss) per
share: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Basic |
|
|
$(0.30) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
4(h) |
|
|
$(0.27)
|
| Diluted |
|
|
$(0.30) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
4(h) |
|
|
$(0.27) |
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) Excludes amortization.
| | SILVERCREST METALS INC. | J-5 |
| | | 2025 Special Meeting of Securityholders |
1. Basis of Presentation
The accompanying Unaudited
Pro Forma Financial Information presents the unaudited pro forma statements of operations and Unaudited Pro Forma Balance Sheet of Coeur
prepared in accordance with Article 11 of SEC Regulation S-X, as amended by the final rule, Release No. 33-10786 “Amendments
to Financial Disclosures about Acquired and Disposed Businesses”. SilverCrest and Coeur prepare their consolidated financial statements
on the basis of a fiscal year ended December 31, 2023. The unaudited pro forma statements of operations were prepared using:
| · | the
historical unaudited condensed interim consolidated statement of earnings of SilverCrest
for the nine months ended September 30, 2024; |
| · | the
historical audited consolidated statement of earnings of SilverCrest for the year ended December
31, 2023; |
| · | the
historical unaudited condensed consolidated statement of operations of Coeur for the nine
months ended September 30, 2024; and |
| · | the
historical audited consolidated statement of operations of Coeur for the year ended December
31, 2023. |
The historical audited
and unaudited consolidated financial statements of Coeur are prepared in accordance with GAAP and are reported in U.S. dollars. The historical
audited consolidated financial statements of SilverCrest are prepared in accordance with IFRS Accounting Standards and the unaudited
condensed interim consolidated financial statements of SilverCrest are prepared in accordance with IAS 34 and are reported in U.S.
dollars.
The unaudited pro forma
statements of operations and the Unaudited Pro Forma Balance Sheet give effect to the Arrangement as if it had occurred on January 1,
2023, and September 30, 2024, respectively.
The Arrangement will
be accounted for using the acquisition method of accounting, as prescribed in Accounting Standards Codification 805, Business Combinations,
under GAAP, which requires an allocation of the purchase price to the assets acquired and liabilities assumed, based on their fair values
as of the date of the Arrangement. As of the date of this Circular, Coeur has not completed the detailed valuation study necessary to
arrive at the required final estimates of the fair value of SilverCrest’s assets to be acquired and liabilities to be assumed and
the related allocations of purchase price.
Material adjustments
have been made to reflect SilverCrest’s historical audited and unaudited consolidated financial statements on a GAAP basis for
purposes of Unaudited Pro Forma Financial Information and to align SilverCrest’s historical significant accounting policies under
IFRS Accounting Standards to Coeur’s significant accounting policies under GAAP. As of the date of this Circular, Coeur has not
identified all adjustments necessary to convert SilverCrest’s historical audited and unaudited financial statements prepared in
accordance with IFRS Accounting Standards to GAAP and to conform SilverCrest’s accounting policies to Coeur’s accounting
policies.
A final determination
of the fair value of SilverCrest’s assets and liabilities, including property, plant and mine development, will be based on the
actual property, plant and mine development of SilverCrest that exist as of the closing date of the Arrangement and, therefore, cannot
be made prior to the consummation of the Arrangement. In addition, the value of the purchase consideration to be paid by Coeur upon the
consummation of the Arrangement will be determined based on the closing price of Coeur Shares on the Arrangement date. As a result of
the foregoing, the pro forma adjustments are preliminary and are subject to change as additional information becomes available and as
additional analysis is performed. The preliminary pro forma adjustments have been made solely for the purpose of providing the Unaudited
Pro Forma Financial Information presented herein. Coeur has estimated the fair value of SilverCrest’s assets and liabilities based
on discussions with SilverCrest’s management, preliminary valuation studies, due diligence and information presented in SilverCrest’s
filings with securities regulatory authorities in Canada.
Until the Arrangement
is implemented, both companies are limited in their ability to share certain information. Upon implementation of the Arrangement, a final
determination of fair value of SilverCrest’s assets and liabilities will be performed. Any increases or decreases in the fair value
of assets acquired and liabilities assumed upon completion of the final valuations will result in adjustments to the Unaudited Pro Forma
Balance Sheet and Unaudited Pro Forma Statements of Operations. The final purchase price allocation may be materially different than
that reflected in the pro forma purchase price allocation presented herein.
| | SILVERCREST METALS INC. | J-6 |
| | | 2025 Special Meeting of Securityholders |
Purchase Consideration
The total preliminary
estimated purchase price of approximately US$1,696.2 million was determined as of October 3, 2024, based on the issued and outstanding
SilverCrest Shares, which includes equity awards outstanding under SilverCrest’s incentive compensation plans that are expected
to vest before the close of the Arrangement. The number of Coeur Shares to be issued is based on the number of SilverCrest Shares outstanding
multiplied by the Exchange Ratio.
The final purchase consideration
will be based on the actual closing price per share of Coeur Shares on the closing date, which could differ materially from the assumed
Coeur Share price used to estimate purchase consideration for the purposes of the Unaudited Pro Forma Financial Information. For purposes
of the Unaudited Pro Forma Financial Information, such common stock and equity awards are assumed to remain outstanding as of the closing
date of the Arrangement. Further, no effect has been given to any other new SilverCrest Shares or other equity awards that may be issued
or granted subsequent to the date of this Circular and before the closing date of the Arrangement. In all cases in which Coeur’s
closing stock price is a determining factor in arriving at the final purchase consideration, the stock price assumed for the total preliminary
purchase price is the closing price of Coeur Shares on October 3, 2024 ($7.08 per share), the most recent date practicable prior
to the mail date of this Circular. A hypothetical 10 percent change in the closing price of each Coeur Share as of October 3, 2024,
would have an approximate $169.6 million impact on the purchase price, which would result in $169.6 million additional goodwill
or a reduction to goodwill of $169.6 million.
| (in
thousands, except for share and per share data) |
|
|
Shares |
|
|
Per
Share |
|
|
Preliminary Purchase
Consideration
|
| Stock Consideration |
|
|
|
|
|
|
|
|
|
| Coeur Shares exchanged
for SilverCrest Shares(1) |
|
|
239,570,251 |
|
|
$7.08 |
|
|
$1,696,157 |
| |
|
|
|
|
|
|
|
|
|
| (1) | Assumes
that 239.6 million Coeur Shares will be exchanged for 148.7 million issued and outstanding
SilverCrest Shares as of September 30, 2024. SilverCrest shareholders will receive 1.6022
shares of common stock, par value $0.01 per share. |
Preliminary Purchase Price Allocation
The table below summarizes
the preliminary allocation of purchase price to the assets acquired and liabilities assumed of SilverCrest for the purposes of the Unaudited
Pro Forma Financial Information as if the Arrangement had occurred on October 3, 2024:
| |
|
|
|
| |
|
|
(in
thousands) |
| Preliminary Purchase
Price Allocation |
|
|
|
| Cash and Cash equivalents |
|
|
$120,864
|
| Receivables |
|
|
14,133
|
| Inventory |
|
|
140,425
|
| Bullion |
|
|
37,374
|
| Prepaid expenses and
other |
|
|
7,671
|
| Property, plant and equipment
and mining properties, net |
|
|
1,350,832
|
| Goodwill |
|
|
446,151
|
| Deferred taxes |
|
|
6,771
|
| Receivables |
|
|
16,953
|
| Other |
|
|
5,428
|
| Total Assets |
|
|
2,146,602
|
| Accounts payable |
|
|
6,816
|
| Accrued liabilities and
other |
|
|
47,912
|
| Debt |
|
|
990
|
| Reclamation |
|
|
11,442
|
| Deferred tax liabilities |
|
|
380,587
|
| Other long-term liabilities |
|
|
2,698
|
| Total liabilities |
|
|
450,445
|
| Total Preliminary Purchase
Price |
|
|
$1,696,157 |
| | SILVERCREST METALS INC. | J-7 |
| | | 2025 Special Meeting of Securityholders |
2.
SilverCrest Historical Financial Statements
SilverCrest’s
historical audited and unaudited consolidated financial statements as described above and are presented under IFRS Accounting Standards
and are in U.S. dollars. The historical balances reflect certain reclassifications of SilverCrest’s consolidated income statements
and consolidated statement of financial position categories to conform to Coeur’s presentation in its consolidated statement of
operations and consolidated balance sheet. In addition, material adjustments have been made to align SilverCrest’s historical significant
accounting policies under IFRS Accounting Standards to Coeur’s significant accounting policies under GAAP. Further review may identify
additional reclassifications that could have a material impact on the Unaudited Pro Forma Financial Information of the combined group.
The reclassifications identified and presented in the Unaudited Pro Forma Financial Information are based on discussions with SilverCrest’s
management, due diligence and information presented in SilverCrest’s filings with Canadian securities authorities. Until the Arrangement
is implemented, both companies are limited in their ability to share certain information. As of the date of this Circular, Coeur is not
aware of any additional reclassifications that would have a material impact on the Unaudited Pro Forma Financial Information that are
not reflected in the pro forma adjustments.
The reclassifications are summarized below:
| |
|
|
|
| |
|
|
Balance
Sheet as of September 30, 2024 |
| SilverCrest
Financial Statement Line |
|
|
SilverCrest
Historical
Amount |
|
|
Reclassification |
|
|
Notes |
|
|
SilverCrest
Historical
Reclassified
Amount |
|
|
Coeur
Financial Statement Line |
| (in thousands) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Assets |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Current Assets |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Cash and cash equivalents |
|
|
$120,864 |
|
|
$— |
|
|
|
|
|
$120,864 |
|
|
Cash and cash equivalents
|
| Bullion |
|
|
37,374 |
|
|
— |
|
|
|
|
|
37,374 |
|
|
Bullion |
| Trade and other receivables |
|
|
3,302 |
|
|
10,831 |
|
|
1 |
|
|
14,133 |
|
|
Receivables |
| Value-added tax receivables |
|
|
10,831 |
|
|
(10,831) |
|
|
1 |
|
|
— |
|
|
|
| Inventories |
|
|
59,267 |
|
|
— |
|
|
|
|
|
59,267 |
|
|
Inventory |
| Prepaid expenses and other |
|
|
7,671 |
|
|
— |
|
|
|
|
|
7,671 |
|
|
Other |
| Non-current assets |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Mineral properties, plant
and equipment |
|
|
264,345 |
|
|
— |
|
|
|
|
|
264,345 |
|
|
Property, plant and equipment
and mining properties, net |
| Deferred tax assets |
|
|
1,031 |
|
|
— |
|
|
|
|
|
1,031 |
|
|
Deferred tax assets |
| Long-term value-added tax
receivables |
|
|
16,953 |
|
|
— |
|
|
|
|
|
16,953 |
|
|
Receivables |
| Prepaids and other long-term
assets |
|
|
5,428 |
|
|
— |
|
|
|
|
|
5,428 |
|
|
Other |
| Total Assets |
|
|
$527,066 |
|
|
$— |
|
|
|
|
|
$527,066 |
|
|
|
| Liabilities |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Current liabilities |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Accounts payable and accrued
liabilities |
|
|
$28,467 |
|
|
$(21,651) |
|
|
2 |
|
|
$6,816 |
|
|
Accounts payable |
| |
|
|
|
|
|
41,811 |
|
|
2,3,4 |
|
|
41,811 |
|
|
Accrued liabilities and
other |
| Tax liabilities |
|
|
12,390 |
|
|
(12,390) |
|
|
3 |
|
|
— |
|
|
|
| Derivative liabilities |
|
|
7,770 |
|
|
(7,770) |
|
|
4 |
|
|
— |
|
|
|
| Lease obligations |
|
|
330 |
|
|
— |
|
|
|
|
|
330 |
|
|
Debt |
| Non-current liabilities |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Long-term lease obligations |
|
|
660 |
|
|
— |
|
|
|
|
|
660 |
|
|
Debt |
| Deferred tax liabilities |
|
|
6,614 |
|
|
— |
|
|
|
|
|
6,614 |
|
|
Deferred tax liabilities
|
| Reclamation provision |
|
|
6,656 |
|
|
— |
|
|
|
|
|
6,656 |
|
|
Reclamation |
| Total Liabilities |
|
|
$13,930 |
|
|
$— |
|
|
|
|
|
$13,930 |
|
|
|
| | SILVERCREST METALS INC. | J-8 |
| | | 2025 Special Meeting of Securityholders |
| |
|
|
Balance
Sheet as of September 30, 2024 |
|
| SilverCrest
Financial Statement Line |
|
|
SilverCrest
Historical
Amount |
|
|
Reclassification |
|
|
Notes |
|
|
SilverCrest
Historical
Reclassified
Amount |
|
|
Coeur
Financial Statement Line |
|
| (in thousands) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Equity |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Issued capital |
|
|
$422,117 |
|
|
$8,099 |
|
|
5 |
|
|
$430,216 |
|
|
Additional paid-in capital
|
|
| Share option
reserve |
|
|
8,099 |
|
|
(8,099) |
|
|
5 |
|
|
— |
|
|
|
|
| Currency translation
reserve |
|
|
(3,538) |
|
|
— |
|
|
|
|
|
(3,538) |
|
|
Currency translation adjustment
|
|
| Retained earnings |
|
|
37,501 |
|
|
— |
|
|
|
|
|
37,501 |
|
|
Accumulated deficit |
|
| Total equity |
|
|
$464,179 |
|
|
$— |
|
|
|
|
|
$464,179 |
|
|
|
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| (1) | Represents
a reclassification of SilverCrest value-added tax receivables, historically included in Value-added
tax receivables, to Receivables at Coeur. |
| (2) | Represents
a reclassification of SilverCrest employee-related benefit and accrued operating liabilities,
historically included in Accounts payable and accrued liabilities, to Accrued liabilities
and other at Coeur. |
| (3) | Represents
a reclassification of SilverCrest tax liabilities, historically included in Tax liabilities,
to Accrued liabilities and other at Coeur. |
| (4) | Represents
a reclassification of SilverCrest derivative liabilities, historically included in Derivative
liabilities, to Accrued liabilities and other at Coeur. |
| (5) | Represents
a reclassification of SilverCrest option share reserve, historically included in Share option
reserve, to Additional paid-in capital at Coeur. |
| |
|
|
Income
Statement for the nine months ended September 30, 2024 |
|
| SilverCrest
Financial Statement Line |
|
|
Historical
SilverCrest |
|
|
Reclassifications |
|
|
Notes |
|
|
Reclassified
Historical
SilverCrest |
|
|
Coeur
Financial Statement Line |
| (in thousands) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Revenue |
|
|
$216,758 |
|
|
$— |
|
|
|
|
|
$216,758 |
|
|
Revenue |
| Cost of sales |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Production costs |
|
|
(64,036) |
|
|
(980) |
|
|
1 |
|
|
(65,016) |
|
|
Cost applicable
to sales |
| Depreciation |
|
|
(25,744) |
|
|
— |
|
|
|
|
|
(25,744) |
|
|
Amortization
|
| Government royalties |
|
|
(980) |
|
|
980 |
|
|
1 |
|
|
— |
|
|
|
| General and administrative
expenses |
|
|
(15,017) |
|
|
— |
|
|
|
|
|
(15,017) |
|
|
General and
administrative |
| Exploration and project
expenses |
|
|
(963) |
|
|
— |
|
|
|
|
|
(963) |
|
|
Exploration
|
| |
|
|
|
|
|
(3,817) |
|
|
2,7 |
|
|
(3,817) |
|
|
Pre-development,
reclamation, and other |
| Foreign exchange losses |
|
|
(4,435) |
|
|
4,435 |
|
|
3 |
|
|
— |
|
|
|
| |
|
|
|
|
|
(2,232) |
|
|
4,5 |
|
|
(2,232) |
|
|
Fair value adjustments,
net |
| Transaction and integration
costs |
|
|
(3,435) |
|
|
3,435 |
|
|
7 |
|
|
— |
|
|
|
| Interest income |
|
|
4,594 |
|
|
(4,594) |
|
|
6 |
|
|
— |
|
|
|
| Interest and finance expense |
|
|
(922) |
|
|
402 |
|
|
2 |
|
|
(520) |
|
|
Interest expense,
net of capitalized interest |
| Other expense |
|
|
(2,257) |
|
|
2,371 |
|
|
3,4,5,6 |
|
|
114 |
|
|
Other, net |
| Earnings before income taxes |
|
|
103,563 |
|
|
— |
|
|
|
|
|
103,563 |
|
|
Income (loss)
before income and mining taxes |
| Income tax expense |
|
|
(53,697) |
|
|
— |
|
|
|
|
|
(53,697) |
|
|
Income and mining
tax (expense) benefit |
| Net earnings |
|
|
$49,866 |
|
|
$— |
|
|
|
|
|
$49,866 |
|
|
NET INCOME (LOSS) |
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| | SILVERCREST METALS INC. | J-9 |
| | | 2025 Special Meeting of Securityholders |
| |
|
|
Income
Statement for the year ended December 31, 2023 |
| SilverCrest
Financial Statement Line |
|
|
Historical
SilverCrest |
|
|
Reclassifications |
|
|
Notes |
|
|
Reclassified
Historical
SilverCrest |
|
|
Coeur
Financial Statement Line |
|
| (in thousands) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Revenue |
|
|
$245,130 |
|
|
$— |
|
|
|
|
|
$245,130 |
|
|
Revenue |
|
| Cost of sales |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Production costs |
|
|
(74,108) |
|
|
(1,368) |
|
|
1 |
|
|
(75,476) |
|
|
Cost applicable to sales
|
|
| Depreciation |
|
|
(21,348) |
|
|
— |
|
|
|
|
|
(21,348) |
|
|
Amortization |
|
| Government royalties |
|
|
(1,368) |
|
|
1,368 |
|
|
1 |
|
|
— |
|
|
|
|
| General and administrative
expenses |
|
|
(15,756) |
|
|
— |
|
|
|
|
|
(15,756) |
|
|
General and administrative
|
|
| Exploration and project
expenses |
|
|
(726) |
|
|
— |
|
|
|
|
|
(726) |
|
|
Exploration |
|
| |
|
|
|
|
|
(493) |
|
|
2 |
|
|
(493) |
|
|
Pre-development, reclamation,
and other |
|
| Foreign exchange losses |
|
|
(7,247) |
|
|
7,247 |
|
|
3 |
|
|
— |
|
|
|
| |
|
|
|
|
|
735 |
|
|
4,5 |
|
|
735 |
|
|
Fair value adjustments,
net |
|
| Interest income |
|
|
4,035 |
|
|
(4,035) |
|
|
6 |
|
|
— |
|
|
|
|
| Interest and finance
expense |
|
|
(2,713) |
|
|
493 |
|
|
2 |
|
|
(2,220) |
|
|
Interest expense, net of
capitalized interest |
|
| Other expense |
|
|
(2,653) |
|
|
(3,947) |
|
|
3,4,5,6 |
|
|
(6,600) |
|
|
Other, net |
|
| Earnings before income
taxes |
|
|
123,246 |
|
|
— |
|
|
|
|
|
123,246 |
|
|
Income (loss) before income
and mining taxes |
|
| Income tax expense |
|
|
(6,526) |
|
|
— |
|
|
|
|
|
(6,526) |
|
|
Income and mining tax (expense)
benefit |
|
| Net earnings |
|
|
$116,720 |
|
|
$— |
|
|
|
|
|
$116,720 |
|
|
NET INCOME (LOSS) |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| (1) | Represents
a reclassification of SilverCrest royalties, historically included in Government royalties,
to Cost applicable to sales at Coeur. |
| (2) | Represents
a reclassification of SilverCrest accretion expense, historically included in Interest and
finance expense, to Pre-development, reclamation, and other at Coeur. |
| (3) | Represents
a reclassification of SilverCrest foreign exchange losses, historically included in Foreign
exchange loss, to Other, net at Coeur. |
| (4) | Represents
a reclassification of SilverCrest derivative gains (losses), historically included in Other
expense, to Fair value adjustments, net at Coeur. |
| (5) | Represents
a reclassification of SilverCrest bullion gains (losses), historically included in Other
expense, to Fair value adjustments, net at Coeur. |
| (6) | Represents
a reclassification of SilverCrest interest income, historically included in Interest income,
to Other, net at Coeur. |
| (7) | Represents
a reclassification of SilverCrest Transaction and integration costs, historically included
in Pre-development, reclamation, and other at Coeur. |
3. IFRS Accounting Standards to GAAP and
Accounting Policy Alignment Adjustments
IFRS Accounting Standards
differs in certain material respects from GAAP. The following material adjustments have been made to reflect SilverCrest’s historical
audited and unaudited consolidated income statements and consolidated statement of financial position on a GAAP basis for the purposes
of the unaudited pro forma financial information. In addition, material adjustments have also been made to align SilverCrest’s
significant accounting policies under IFRS Accounting Standards to Coeur’s significant accounting policies under GAAP when there
is no specific difference between IFRS Accounting Standards and GAAP. For a general discussion of the significant differences between
IFRS Accounting Standards and GAAP, see “Management Information Circular – Non-GAAP Financial Performance Measures”.
| | SILVERCREST METALS INC. | J-10 |
| | | 2025 Special Meeting of Securityholders |
(a) Depreciation and amortization
Under GAAP, Coeur’s
accounting policy amortizes certain mine development costs using the units-of-production method over the estimated life of the ore body,
generally based on recoverable ounces to be mined from proven and probable reserves.
Under IFRS Accounting
Standards, SilverCrest includes estimated recoverable ounces using the mineable tonnes extracted from the mine in the period as a percentage
of the total mineable tonnes to be extracted in current and future periods based on mineral reserves.
The following table
reflect the impacts of converting the calculation of depletion on a units-of-production method from mineable tonnes to recoverable ounces:
| (in
thousands) |
|
|
As of
September 30,
2024 |
|
|
For the nine
months ended
September 30,
2024 |
|
|
For the
year ended
December 31,
2023 |
| Condensed Balance
Sheet |
|
|
|
|
|
|
|
|
|
| Decrease to property,
plant and equipment and mine development, net |
|
|
$(15,962) |
|
|
|
|
|
|
| Increase to deferred
income tax asset |
|
|
$4,789 |
|
|
|
|
|
|
| Condensed Statements
of Operations |
|
|
|
|
|
|
|
|
|
| Increase to amortization |
|
|
|
|
|
$2,573 |
|
|
$9,671
|
| Increase to income and
mining tax benefit (expense) |
|
|
|
|
|
$772 |
|
|
$2,901 |
(b) Reclamation and remediation liabilities
Under GAAP, the initial
recognition of the reclamation and remediation liability is recognized at fair value, generally utilizing a present value technique to
estimate the liability discounted at a credit-adjusted risk-free interest rate, and further adjusted for inflation and market risk premium.
Subsequently, period-to-period revisions to either the timing or amount of the original estimate of undiscounted cash flows are treated
as separate layers of the obligation.
Under IFRS Accounting
Standards, reclamation and remediation liabilities are generally measured as the best estimate of the expenditure to settle the obligation
utilizing a present value technique to estimate the liability, adjusted for inflation, associated with reclamation as a liability, at
a risk-free rate, when the liability is incurred. Subsequently, period-to-period revisions for changes in the estimate of expected undiscounted
cash flows or discount rate are re-measured for the entire obligation by using an updated discount rate that reflects current market
conditions as of the balance sheet date.
The following table reflects the impacts
of changes made to the reclamations and remediation liabilities:
| (in
thousands) |
|
|
As of
September 30,
2024 |
|
|
For the nine
months ended
September 30,
2024 |
|
|
For the
year ended
December 31,
2023 |
| Condensed Balance
Sheet |
|
|
|
|
|
|
|
|
|
| Increase to property,
plant and equipment and mine development, net |
|
|
$4,828 |
|
|
|
|
|
|
| Increase to reclamation
liabilities |
|
|
$4,828 |
|
|
|
|
|
|
| Condensed Statements
of Operations |
|
|
|
|
|
|
|
|
|
| Increase to amortization |
|
|
|
|
|
$604 |
|
|
$805
|
| Increase to Pre-development,
reclamation and other |
|
|
|
|
|
$524 |
|
|
$749
|
| Increase to income and
mining tax benefit (expense) |
|
|
|
|
|
$397 |
|
|
$548 |
| | SILVERCREST METALS INC. | J-11 |
| | | 2025 Special Meeting of Securityholders |
(c) Employee-related benefits
Under GAAP, an entity
uses the service period approach to account for termination benefits when certain conditions are met. Benefits accumulate over time based
on length of service. Under this approach, the benefit cost is accrued over an employee’s service period.
Under IFRS Accounting
Standards, an entity recognizes termination benefits as a liability and an expense only when an entity is demonstrably committed to the
redundancies by having (i) a detailed plan for the terminations and (ii) when it can no longer withdraw the offer made in relation to
termination benefits. This generally results in termination benefits being recognized when the closure date for a mine site has been
announced and other recognition criteria have been met.
The following table
reflects the accrual of employee severance for, as well as the impact of, revaluation of the accrual for the periods presented:
| |
|
|
|
|
|
|
|
|
|
| (in
thousands) |
|
|
As of
September 30,
2024 |
|
|
For the nine
months ended
September 30,
2024 |
|
|
For the
year ended
December 31,
2023 |
| Condensed Balance
Sheet |
|
|
|
|
|
|
|
|
|
| Increase to employee-related
benefits |
|
|
$2,698 |
|
|
|
|
|
|
| Increase to deferred
income tax asset |
|
|
$951 |
|
|
|
|
|
|
| Condensed Statements
of Operations |
|
|
|
|
|
|
|
|
|
| Increase to costs applicable
to sales |
|
|
|
|
|
$282 |
|
|
$339
|
| Increase (decrease) to
other, net |
|
|
|
|
|
$423 |
|
|
$(334)
|
| Decrease to income and
mining tax benefit (expense) |
|
|
|
|
|
$(99) |
|
|
$(119) |
4. Arrangement Accounting Adjustments
The following adjustments
have been made to the Unaudited Pro Forma Financial Information to reflect certain preliminary purchase price accounting and other pro
forma adjustments. Further review may identify additional adjustments that could have a material impact on the Unaudited Pro Forma Financial
Information of the combined group. At this time, Coeur is not aware of any additional arrangement-related adjustments that would have
a material impact on the Unaudited Pro Forma Financial Information that are not reflected or disclosed in the pro forma adjustments.
(a) Arrangement costs and other one-time
charges
The increase in Pre-development,
reclamation, and other of $13.0 million for the year ended December 31, 2023 and the corresponding increase in Accrued liabilities
and other of $13.0 million, of which $12.0 million relates to financial advisory services fees, reflects the adjustment to
recognize transaction costs and other non-recurring charges expected to be incurred in connection with the Arrangement. For the nine
months ended September 30, 2024, $1.0 million and $3.4 million were recognized in Pre-development, reclamation, and other
and Transaction and integration costs by Coeur and SilverCrest within their historical financial information, respectively, relating
to transaction costs and non-recurring charges incurred.
(b) Inventories
The adjustment to increase
in Inventories by $81.2 million reflects the adjustments to step up the pro forma balance for SilverCrest’s finished goods, work-in-process
and stockpile inventory to estimated fair value as of September 30, 2024. The fair value was determined based on estimated selling
price of the inventory, less the remaining processing and selling costs and a normal profit margin on those processing and selling efforts.
As a result of the increase, there was an increase to Costs applicable to sales of $56.8 million for the year ended December 31,
2023 and an increase to Depreciation and amortization by $24.3 million for the year ended December 31, 2023.
| | SILVERCREST METALS INC. | J-12 |
| | | 2025 Special Meeting of Securityholders |
(c) Property, plant and equipment and
mine development, net
The adjustment to increase
Property, plant and equipment and mine development, net by $1,097.6 million reflects the fair value estimate of property, plant, and
equipment and mine development as of September 30, 2024, and the related increase to Amortization of $94.1 million and $122.3 million
for the nine months ended September 30, 2024 and year ended December 31, 2023, respectively.
(d) Share-based compensation
The adjustment for share-based
awards represents the difference between SilverCrest’s historical share-based compensation expense and the estimated share-based
compensation expense related to 1.4 million shares of Coeur Shares that will be issued as replacement awards as part of the Arrangement.
The fair value of the replacement stock option share-based awards will be recognized ratably over post-combination service periods ranging
from two to three years. The pro forma condensed income statement includes an adjustment to increase Cost applicable to sales by $0.1 million
and $0.2 million for the nine months ended September 30, 2024 and year ended December 31, 2023, respectively.
(e) Income taxes
Deferred income taxes
have been recognized based on pro forma IFRS Accounting Standards to GAAP accounting, policy alignment, and fair value adjustments to
identifiable assets acquired and liabilities assumed of SilverCrest using the statutory tax rate on a jurisdictional basis. The $373.9 million
and $6.1 million increase in Deferred tax liabilities and Accrued liabilities and other, respectively, reflects the preliminary estimate
of deferred tax assets and liabilities recognized on the new book to tax basis differences of assets acquired and liabilities assumed,
and have been recognized as part of the Goodwill.
The estimated income
and mining tax expense impact of the pro forma adjustments (except for the impact of certain transaction costs for which no tax benefit
is expected due to a valuation allowance) has been recognized based upon the statutory tax rates applicable on a jurisdictional basis.
(f) SilverCrest shareholders’
equity
The adjustment reflects
the elimination of $451.3 million of SilverCrest’s shareholders’ equity, which represents the historical book value of SilverCrest’s
net assets including IFRS Accounting Standards to GAAP and accounting policy adjustments of $(12.9) million, as a result of the
application of purchase price accounting. The adjustment reflects an increase of $0.2 million and $1,695.9 million to Coeur Shares
and Additional paid-in capital, respectively, to reflect the issuance of 239.6 million Coeur Shares to satisfy the issuance of the Exchange
Ratio of Coeur Shares for each SilverCrest Share outstanding pursuant to the Arrangement Agreement, assuming a closing price of Coeur
Shares on October 03, 2024 of $7.08 per share.
The table below reflects
elimination of SilverCrest’s shareholders’ equity after adjustments for IFRS Accounting Standards to GAAP differences and
purchase price accounting and other pro forma adjustments as of September 30, 2024. For a general discussion of the significant
differences between IFRS Accounting Standards and GAAP, see “Management Information Circular – Non-GAAP Financial Performance
Measures”.
| | SILVERCREST METALS INC. | J-13 |
| | | 2025 Special Meeting of Securityholders |
| (in
thousands) |
|
|
Reclassified
Historical
SilverCrest |
|
|
IFRS Accounting
Standards to GAAP
and Accounting
Policy Adjustments |
|
|
Arrangement
Accounting
Adjustments |
|
|
Equity
Adjustments |
|
|
Notes |
|
|
Pro
Forma |
| Common stock |
|
|
$— |
|
|
$— |
|
|
$— |
|
|
$240 |
|
|
1 |
|
|
$240
|
| Additional paid-in capital |
|
|
430,216 |
|
|
— |
|
|
— |
|
|
1,265,701 |
|
|
2 |
|
|
1,695,917
|
| Current translation adjustments |
|
|
(3,538) |
|
|
— |
|
|
— |
|
|
3,538 |
|
|
3 |
|
|
—
|
| Retained earnings (accumulated
deficit) |
|
|
37,501 |
|
|
(12,920) |
|
|
(13,024) |
|
|
(24,581) |
|
|
4 |
|
|
(13,024)
|
| Total SilverCrest Equity |
|
|
$464,179 |
|
|
$(12,920) |
|
|
$(13,024) |
|
|
$1,244,898 |
|
|
|
|
|
$1,683,133 |
| | |
| (1) | Represents
issuance of 239.6 million shares of Coeur common stock with a par value of $0.01 per share
in exchange of 148.7 million shares of SilverCrest outstanding. |
| (2) | Represents
adjustments to Additional paid-in capital, to record issuance of 239.6 million shares for
$1,695.9 million, calculated by deducting the $0.2 million included in Common stock from
the preliminary purchase price consideration of $1,696.2 million. |
| (3) | Represents
adjustment to write-off SilverCrest’s historical Current translation adjustments. |
| (4) | Represents
adjustments to write-off SilverCrest’s historical Retained earnings of $37.5 million,
net of $(12.9) million of IFRS Accounting Standards to U.S. GAAP and accounting policy adjustments.
The remaining $(13.0) million represents transaction costs, as discussed in Note 4(a). |
(g) Goodwill
Goodwill is calculated
as the difference between the preliminary estimated purchase price and the fair values assigned to the identifiable tangible and intangible
assets acquired and liabilities assumed of SilverCrest. The fair value of assets acquired and liabilities assumed is preliminary and
will be finalized upon completion of the Arrangement. Based on the preliminary purchase price allocation, Coeur has recognized $446.2
million of Goodwill. This amount may increase or decrease based on the final purchase price allocation. Goodwill recorded in connection
with the acquisition is not deductible for income tax purposes.
(h) Earnings per share
The pro forma combined
diluted earnings per share presented below reflects the adjustment to weighted average number of shares outstanding based on the Exchange
Ratio of Coeur Shares for each SilverCrest Share outstanding of 148.7 million as of September 30, 2024 as follows:
| (in
thousands, except per share) |
|
|
For the nine months
ended September 30,
2024 |
|
|
For the year ended
December 31,
2023 |
| Pro forma net income
(loss) from continuing operations attributable to Coeur stockholders |
|
|
$(1,680) |
|
|
$(154,097)
|
| Pro forma basic weighted
average Coeur shares outstanding1 |
|
|
629,114 |
|
|
581,237
|
| Pro forma basic earnings
(loss) per share |
|
|
$0.00 |
|
|
$(0.27)
|
| Pro forma diluted weighted
average Coeur shares outstanding1 |
|
|
629,114 |
|
|
581,237
|
| Pro forma diluted earnings
(loss) per share2 |
|
|
$0.00 |
|
|
$(0.27) |
| | | |
| (1) | For
the nine months ended September 30, 2024, basic and diluted weighted average shares outstanding
of 629.1 million is comprised of 390.9 million shares of Coeur common stock and 238.2 million
shares of Coeur common stock to be exchanged for 148.7 million shares of issued and outstanding
SilverCrest common shares as of September 30, 2024. For the year ended December 31, 2023,
basic and diluted weighted average shares outstanding of 581.2 million is comprised of 343.1
million shares of Coeur common stock and 238.2 million shares of Coeur common stock to be
exchanged for 148.7 million shares of issued and outstanding SilverCrest common shares as
of September 30, 2024. |
| (2) | Potentially
dilutive shares were excluded in the computation of diluted loss per share for the nine months
ended September 30, 2024 and year ended December 31, 2023 as they were antidilutive. |
| | SILVERCREST METALS INC. | J-14 |
| | | 2025 Special Meeting of Securityholders |
5. Management Adjustments
The tables below show
the expected cost savings related to the Company’s expected General and administrative savings through the reduction of SilverCrest’s
executive management team and directors, which is estimated to achieve an annual pretax savings of approximately $12 million.
The adjustments shown
below include those that management deemed necessary for a fair statement of the pro forma information presented. The adjustments include
forward-looking information that is subject to the safe harbor protections of the U.S. Exchange Act, and actual results could differ
materially from what is presented below as efforts to integrate SilverCrest are carried out.
| For
the nine months ended September 30, 2024 |
| (in
thousands, except per share) |
|
|
Net Income
(Loss) |
|
|
Basic and diluted
loss per share
|
|
|
Weighted average
shares |
| Pro forma combined |
|
|
$(1,680) |
|
|
$0.00 |
|
|
629,114
|
| General and administrative
savings |
|
|
9,000 |
|
|
|
|
|
|
| Tax effect |
|
|
(3,173) |
|
|
|
|
|
|
| Pro forma combined after
general and administrative savings, net of tax |
|
|
$4,147 |
|
|
$0.01 |
|
|
634,556 |
| |
|
|
|
|
|
|
|
|
|
| For
the year ended December 31, 2023 |
| (in
thousands, except per share) |
|
|
Net Income
(Loss) |
|
|
Basic and diluted
loss per share |
|
|
Weighted average
shares |
| Pro forma combined |
|
|
$(154,097) |
|
|
$(0.27) |
|
|
581,237
|
| General and administrative
savings |
|
|
12,000 |
|
|
|
|
|
|
| Tax effect |
|
|
(4,230) |
|
|
|
|
|
|
| Pro forma combined after
general and administrative savings, net of tax |
|
|
$(146,327) |
|
|
$(0.25) |
|
|
581,237 |
Unaudited Pro Forma Per
Share Data
The following table
presents, as of the dates and for the periods indicated, selected historical unaudited pro forma combined financial information per share
of Coeur Shares and SilverCrest Shares. You should read this information in conjunction with, and the information is qualified in its
entirety by, the consolidated financial statements of Coeur and notes thereto incorporated by reference into this Circular (see “Other
Information – Additional Information”) and the unaudited pro forma consolidated financial statements of SilverCrest
and notes thereto included in this Circular.
SilverCrest’s
consolidated financial statements are prepared in accordance with IFRS Accounting Standards, which differs in a number of significant
respects from GAAP. For a general discussion of the significant differences between IFRS Accounting Standards and GAAP, see “Management
Information Circular – Non-GAAP Financial Performance Measures”.
The following pro forma
information has been prepared in accordance with the rules and regulations of the SEC and accordingly includes the effects of acquisition
accounting. It does not reflect cost savings, synergies or certain other adjustments that may result from the Arrangement. This information
is presented for illustrative purposes only. You should not rely on the pro forma combined or equivalent pro forma amounts as they are
not necessarily indicative of the operating results or financial position that would have occurred if the Arrangement had been completed
as of the dates indicated, nor are they necessarily
indicative of the future operating results or financial position of the combined group. The pro forma information, although helpful in
illustrating the financial characteristics of the combined group under one set of assumptions, does not reflect the benefits of expected
cost savings, opportunities to earn additional revenue, the impact of restructuring, or other factors that may result as a consequence
of the Arrangement and, accordingly, does not attempt to predict or suggest future results.
| | SILVERCREST METALS INC. | J-15 |
| | | 2025 Special Meeting of Securityholders |
The following table
assumes the issuance of approximately 238.2 million shares of Coeur Shares in connection with the Arrangement, which is the number of
shares issuable by Coeur in connection with the Arrangement assuming the Arrangement occurred on January 1, 2023 and based on the
number of outstanding SilverCrest Shares as of September 30, 2024. As discussed in this Circular, the actual number of shares of
Coeur Shares issuable under the Arrangement will be adjusted based on the number of SilverCrest Shares outstanding at the consummation
of the Arrangement. The pro forma data in the table assumes that the Arrangement occurred on January 1, 2023 for condensed combined
statement of operations purposes and on September 30, 2024 for condensed combined balance sheet purposes.
| (in
millions, except per share) |
|
|
Coeur |
|
|
As at and for
the
nine months ended
September 30,
2024
SilverCrest |
|
|
Pro Forma
Combined |
| Income (loss) from
continuing operations per common share |
|
|
|
|
|
|
|
|
|
| Basic |
|
|
$0.05 |
|
|
$0.34 |
|
|
$0.00
|
| Diluted1 |
|
|
$0.05 |
|
|
$0.33 |
|
|
$0.00
|
| Shares used in calculating
basic and diluted income (loss) from continuing operations per common share |
|
|
|
|
|
|
|
|
|
| Basic |
|
|
390,936 |
|
|
147,759 |
|
|
629,114
|
| Diluted |
|
|
396,378 |
|
|
149,116 |
|
|
629,114
|
| Book value per share |
|
|
$0.37 |
|
|
$0.32 |
|
|
$0.23 |
| | | |
| (1) | Potentially
dilutive shares were excluded in the computation of diluted loss per share for Pro Forma
Combined for the nine months ended September 30, 2024 as they were antidilutive. |
The following table
assumes the issuance of approximately 238.2 million shares of Coeur Shares in connection with the Arrangement, which is the number of
shares issuable by Coeur in connection with the Arrangement assuming the Arrangement occurred on January 1, 2023 and based on the
number of outstanding SilverCrest Shares as of September 30, 2024. As discussed in this Circular, the actual number of Coeur Shares issuable
under the Arrangement will be adjusted based on the number of SilverCrest Shares outstanding at the consummation of the Arrangement.
The pro forma data in the table assumes that the Arrangement occurred on January 1, 2023 for condensed combined statement of operations
purposes and on December 31, 2023 for condensed combined balance sheet purposes.
| (in
millions, except per share) |
|
|
Coeur |
|
|
As at and for
the
year ended
December 31,
2023
SilverCrest |
|
|
Pro Forma
Combined |
| Income (loss) from
continuing operations per common share |
|
|
|
|
|
|
|
|
|
| Basic |
|
|
$(0.30) |
|
|
$0.27 |
|
|
$(0.27)
|
| Diluted1 |
|
|
$(0.30) |
|
|
$0.27 |
|
|
$(0.27)
|
| Shares used in calculating
basic and diluted income (loss) from continuing operations per common share |
|
|
|
|
|
|
|
|
|
| Basic |
|
|
343,059 |
|
|
146,882 |
|
|
581,237
|
| Diluted |
|
|
343,059 |
|
|
147,539 |
|
|
581,237
|
| Book value per share |
|
|
$0.32 |
|
|
$0.32 |
|
|
$0.21 |
| | | |
| (1) | Potentially
dilutive shares were excluded in the computation of diluted loss per share for Coeur and
Pro Forma Combined for the year ended December 31, 2023 as they were antidilutive. |
| | SILVERCREST METALS INC. | J-16 |
| | | 2025 Special Meeting of Securityholders |
APPENDIX
K
DISSENT PROVISIONS OF THE BCBCA
DIVISION 2
OF PART 8 OF THE BUSINESS CORPORATIONS ACT (BRITISH COLUMBIA)
Definitions
and application
237 (1) In this
Division:
“dissenter”
means a Shareholder who, being entitled to do so, sends written notice of dissent when and as required by section 242;
“notice
shares” means, in relation to a notice of dissent, the shares in respect of which dissent is being exercised under the notice
of dissent;
“payout
value” means,
(a) in
the case of a dissent in respect of a resolution, the fair value that the notice shares had immediately before the passing of the resolution,
(b) in
the case of a dissent in respect of an arrangement approved by a court order made under section 291 (2) (c) that permits dissent, the
fair value that the notice shares had immediately before the passing of the resolution adopting the arrangement,
(c) in
the case of a dissent in respect of a matter approved or authorized by any other court order that permits dissent, the fair value that
the notice shares had at the time specified by the court order, or
(d) in
the case of a dissent in respect of a community contribution company, the value of the notice shares set out in the regulations, excluding
any appreciation or depreciation in anticipation of the corporate action approved or authorized by the resolution or court order unless
exclusion would be inequitable.
(2) This Division
applies to any right of dissent exercisable by a Shareholder except to the extent that
(a) the
court orders otherwise, or
(b) in
the case of a right of dissent authorized by a resolution referred to in section 238 (1) (g), the court orders otherwise or the resolution
provides otherwise.
Right to dissent
238 (1) A Shareholder
of a company, whether or not the Shareholder’s shares carry the right to vote, is entitled to dissent as follows:
(a) under
section 260, in respect of a resolution to alter the articles
(i) to
alter restrictions on the powers of the company or on the business the company is permitted to carry on, or
(ii) without
limiting subparagraph (i), in the case of a community contribution company, to alter any of the company’s community purposes within
the meaning of section 51.91;
(b) under
section 272, in respect of a resolution to adopt an amalgamation agreement;
(c) under
section 287, in respect of a resolution to approve an amalgamation under Division 4 of Part 9;
(d) in
respect of a resolution to approve an arrangement, the terms of which arrangement permit dissent;
| | SILVERCREST METALS INC. | K-1 |
| | | 2025 Special Meeting of Securityholders |
(e) under
section 301 (5), in respect of a resolution to authorize or ratify the sale, lease or other disposition of all or substantially all of
the company’s undertaking;
(f) under
section 309, in respect of a resolution to authorize the continuation of the company into a jurisdiction other than British Columbia;
(g) in
respect of any other resolution, if dissent is authorized by the resolution;
(h) in
respect of any court order that permits dissent.
(2) A Shareholder
wishing to dissent must
(a) prepare
a separate notice of dissent under section 242 for
(i) the
Shareholder, if the Shareholder is dissenting on the Shareholder’s own behalf, and
(ii) each
other person who beneficially owns shares registered in the Shareholder’s name and on whose behalf the Shareholder is dissenting,
(b) identify
in each notice of dissent, in accordance with section 242 (4), the person on whose behalf dissent is being exercised in that notice of
dissent, and
(c) dissent
with respect to all of the shares, registered in the Shareholder’s name, of which the person identified under paragraph (b) of
this subsection is the beneficial owner.
(3) Without limiting
subsection (2), a person who wishes to have dissent exercised with respect to shares of which the person is the beneficial owner must
(a) dissent
with respect to all of the shares, if any, of which the person is both the registered owner and the beneficial owner, and
(b) cause
each Shareholder who is a registered owner of any other shares of which the person is the beneficial owner to dissent with respect to
all of those shares.
Waiver of
right to dissent
239 (1) A Shareholder
may not waive generally a right to dissent but may, in writing, waive the right to dissent with respect to a particular corporate action.
(2) A Shareholder
wishing to waive a right of dissent with respect to a particular corporate action must
(a) provide
to the company a separate waiver for
(i) the
Shareholder, if the Shareholder is providing a waiver on the Shareholder’s own behalf, and
(ii) each
other person who beneficially owns shares registered in the Shareholder’s name and on whose behalf the Shareholder is providing
a waiver, and
(b) identify
in each waiver the person on whose behalf the waiver is made.
(3) If a Shareholder
waives a right of dissent with respect to a particular corporate action and indicates in the waiver that the right to dissent is being
waived on the Shareholder’s own behalf, the Shareholder’s right to dissent with respect to the particular
corporate action terminates in respect of the shares of which the Shareholder is both the registered owner and the beneficial owner,
and this Division ceases to apply to
| | SILVERCREST METALS INC. | K-2 |
| | | 2025 Special Meeting of Securityholders |
(a) the
Shareholder in respect of the shares of which the Shareholder is both the registered owner and the beneficial owner, and
(b) any
other Shareholders, who are registered owners of shares beneficially owned by the first mentioned Shareholder, in respect of the shares
that are beneficially owned by the first mentioned Shareholder.
(4) If a Shareholder
waives a right of dissent with respect to a particular corporate action and indicates in the waiver that the right to dissent is being
waived on behalf of a specified person who beneficially owns shares registered in the name of the Shareholder, the right of Shareholders
who are registered owners of shares beneficially owned by that specified person to dissent on behalf of that specified person with respect
to the particular corporate action terminates and this Division ceases to apply to those Shareholders in respect of the shares that are
beneficially owned by that specified person.
Notice of
resolution
240 (1) If a
resolution in respect of which a Shareholder is entitled to dissent is to be considered at a meeting of Shareholders, the company must,
at least the prescribed number of days before the date of the proposed meeting, send to each of its Shareholders, whether or not their
shares carry the right to vote,
(a) a
copy of the proposed resolution, and
(b) a
notice of the meeting that specifies the date of the meeting, and contains a statement advising of the right to send a notice of dissent.
(2) If a resolution
in respect of which a Shareholder is entitled to dissent is to be passed as a consent resolution of Shareholders or as a resolution of
directors and the earliest date on which that resolution can be passed is specified in the resolution or in the statement referred to
in paragraph (b), the company may, at least 21 days before that specified date, send to each of its Shareholders, whether or not their
shares carry the right to vote,
(a) a
copy of the proposed resolution, and
(b) a
statement advising of the right to send a notice of dissent.
(3) If a resolution
in respect of which a Shareholder is entitled to dissent was or is to be passed as a resolution of Shareholders without the company complying
with subsection (1) or (2), or was or is to be passed as a directors’ resolution without the company complying with subsection
(2), the company must, before or within 14 days after the passing of the resolution, send to each of its Shareholders who has not, on
behalf of every person who beneficially owns shares registered in the name of the Shareholder, consented to the resolution or voted in
favour of the resolution, whether or not their shares carry the right to vote,
(a) a
copy of the resolution,
(b) a
statement advising of the right to send a notice of dissent, and
(c) if
the resolution has passed, notification of that fact and the date on which it was passed.
(4) Nothing in
subsection (1), (2) or (3) gives a Shareholder a right to vote in a meeting at which, or on a resolution on which, the Shareholder would
not otherwise be entitled to vote.
Notice of
court orders
241 If a court
order provides for a right of dissent, the company must, not later than 14 days after the date on which the company receives a copy of
the entered order, send to each Shareholder who is entitled to exercise that right of dissent
(a) a
copy of the entered order, and
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(b) a
statement advising of the right to send a notice of dissent.
Notice of
dissent
242 (1) A Shareholder
intending to dissent in respect of a resolution referred to in section 238 (1) (a), (b), (c), (d), (e) or (f) must,
(a) if
the company has complied with section 240 (1) or (2), send written notice of dissent to the company at least 2 days before the date on
which the resolution is to be passed or can be passed, as the case may be,
(b) if
the company has complied with section 240 (3), send written notice of dissent to the company not more than 14 days after receiving the
records referred to in that section, or
(c) if
the company has not complied with section 240 (1), (2) or (3), send written notice of dissent to the company not more than 14 days after
the later of
(i) the
date on which the Shareholder learns that the resolution was passed, and
(ii) the
date on which the Shareholder learns that the Shareholder is entitled to dissent.
(2) A Shareholder
intending to dissent in respect of a resolution referred to in section 238 (1)(g) must send written notice of dissent to the company
(a) on
or before the date specified by the resolution or in the statement referred to in section 240(2) (b) or (3)(b) as the last date by which
notice of dissent must be sent, or
(b) if
the resolution or statement does not specify a date, in accordance with subsection (1) of this section.
(3) A Shareholder
intending to dissent under section 238(1)(h) in respect of a court order that permits dissent must send written notice of dissent to
the company
(a) within
the number of days, specified by the court order, after the Shareholder receives the records referred to in section 241, or
(b) if
the court order does not specify the number of days referred to in paragraph (a) of this subsection, within 14 days after the Shareholder
receives the records referred to in section 241.
(4) A notice
of dissent sent under this section must set out the number, and the class and series, if applicable, of the notice shares, and must set
out whichever of the following is applicable:
(a) if
the notice shares constitute all of the shares of which the Shareholder is both the registered owner and beneficial owner and the Shareholder
owns no other shares of the company as beneficial owner, a statement to that effect;
(b) if
the notice shares constitute all of the shares of which the Shareholder is both the registered owner and beneficial owner but the Shareholder
owns other shares of the company as beneficial owner, a statement to that effect and
(i) the
names of the registered owners of those other shares,
(ii) the
number, and the class and series, if applicable, of those other shares that are held by each of those registered owners, and
(iii) a
statement that notices of dissent are being, or have been, sent in respect of all of those other shares;
(c) if
dissent is being exercised by the Shareholder on behalf of a beneficial owner who is not the dissenting Shareholder, a statement to that
effect and
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(i) the
name and address of the beneficial owner, and
(ii) a
statement that the Shareholder is dissenting in relation to all of the shares beneficially owned by the beneficial owner that are registered
in the Shareholder’s name.
(5) The right
of a Shareholder to dissent on behalf of a beneficial owner of shares, including the Shareholder, terminates and this Division ceases
to apply to the Shareholder in respect of that beneficial owner if subsections (1) to (4) of this section, as those subsections pertain
to that beneficial owner, are not complied with.
Notice of
intention to proceed
243 (1) A company
that receives a notice of dissent under section 242 from a dissenter must,
(a) if
the company intends to act on the authority of the resolution or court order in respect of which the notice of dissent was sent, send
a notice to the dissenter promptly after the later of
(i) the
date on which the company forms the intention to proceed, and
(ii) the
date on which the notice of dissent was received, or
(b) if
the company has acted on the authority of that resolution or court order, promptly send a notice to the dissenter.
(2) A notice
sent under subsection (1)(a) or (b) of this section must
(a) be
dated not earlier than the date on which the notice is sent,
(b) state
that the company intends to act, or has acted, as the case may be, on the authority of the resolution or court order, and
(c) advise
the dissenter of the manner in which dissent is to be completed under section 244.
Completion
of dissent
244 (1) A dissenter
who receives a notice under section 243 must, if the dissenter wishes to proceed with the dissent, send to the company or its transfer
agent for the notice shares, within one month after the date of the notice,
(a) a
written statement that the dissenter requires the company to purchase all of the notice shares,
(b) the
certificates, if any, representing the notice shares, and
(c) if
section 242(4)(c) applies, a written statement that complies with subsection (2) of this section.
(2) The written
statement referred to in subsection (1)(c) must
(a) be
signed by the beneficial owner on whose behalf dissent is being exercised, and
(b) set
out whether or not the beneficial owner is the beneficial owner of other shares of the company and, if so, set out
(i) the
names of the registered owners of those other shares,
(ii) the
number, and the class and series, if applicable, of those other shares that are held by each of those registered owners, and
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(iii) that
dissent is being exercised in respect of all of those other shares.
(3) After the
dissenter has complied with subsection (1),
(a) the
dissenter is deemed to have sold to the company the notice shares, and
(b) the
company is deemed to have purchased those shares, and must comply with section 245, whether or not it is authorized to do so by, and
despite any restriction in, its memorandum or articles.
(4) Unless the
court orders otherwise, if the dissenter fails to comply with subsection (1) of this section in relation to notice shares, the right
of the dissenter to dissent with respect to those notice shares terminates and this Division, other than section 247, ceases to apply
to the dissenter with respect to those notice shares.
(5) Unless the
court orders otherwise, if a person on whose behalf dissent is being exercised in relation to a particular corporate action fails to
ensure that every Shareholder who is a registered owner of any of the shares beneficially owned by that person complies with subsection
(1) of this section, the right of Shareholders who are registered owners of shares beneficially owned by that person to dissent on behalf
of that person with respect to that corporate action terminates and this Division, other than section 247, ceases to apply to those Shareholders
in respect of the shares that are beneficially owned by that person.
(6) A dissenter
who has complied with subsection (1) of this section may not vote, or exercise or assert any rights of a Shareholder, in respect of the
notice shares, other than under this Division.
Payment for
notice shares
245 (1) A company
and a dissenter who has complied with section 244 (1) may agree on the amount of the payout value of the notice shares and, in that event,
the company must
(a) promptly
pay that amount to the dissenter, or
(b) if
subsection (5) of this section applies, promptly send a notice to the dissenter that the company is unable lawfully to pay dissenters
for their shares.
(2) A dissenter
who has not entered into an agreement with the company under subsection (1) or the company may apply to the court and the court may
(a) determine
the payout value of the notice shares of those dissenters who have not entered into an agreement with the company under subsection (1),
or order that the payout value of those notice shares be established by arbitration or by reference to the registrar, or a referee, of
the court,
(b) join
in the application each dissenter, other than a dissenter who has entered into an agreement with the company under subsection (1), who
has complied with section 244(1), and
(c) make
consequential orders and give directions it considers appropriate.
(3) Promptly
after a determination of the payout value for notice shares has been made under subsection (2)(a) of this section, the company must
(a) pay
to each dissenter who has complied with section 244(1) in relation to those notice shares, other than a dissenter who has entered into
an agreement with the company under subsection (1) of this section, the payout value applicable to that dissenter’s notice shares,
or
(b) if
subsection (5) applies, promptly send a notice to the dissenter that the company is unable lawfully to pay dissenters for their shares.
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(4) If a dissenter
receives a notice under subsection (1)(b) or (3)(b),
(a) the
dissenter may, within 30 days after receipt, withdraw the dissenter’s notice of dissent, in which case the company is deemed to
consent to the withdrawal and this Division, other than section 247, ceases to apply to the dissenter with respect to the notice shares,
or
(b) if
the dissenter does not withdraw the notice of dissent in accordance with paragraph (a) of this subsection, the dissenter retains a status
as a claimant against the company, to be paid as soon as the company is lawfully able to do so or, in a liquidation, to be ranked subordinate
to the rights of creditors of the company but in priority to its Shareholders.
(5) A company
must not make a payment to a dissenter under this section if there are reasonable grounds for believing that
(a) the
company is insolvent, or
(b) the
payment would render the company insolvent.
Loss of right
to dissent
246 The right
of a dissenter to dissent with respect to notice shares terminates and this Division, other than section 247, ceases to apply to the
dissenter with respect to those notice shares, if, before payment is made to the dissenter of the full amount of money to which the dissenter
is entitled under section 245 in relation to those notice shares, any of the following events occur:
(a) the
corporate action approved or authorized, or to be approved or authorized, by the resolution or court order in respect of which the notice
of dissent was sent is abandoned;
(b) the
resolution in respect of which the notice of dissent was sent does not pass;
(c) the
resolution in respect of which the notice of dissent was sent is revoked before the corporate action approved or authorized by that resolution
is taken;
(d) the
notice of dissent was sent in respect of a resolution adopting an amalgamation agreement and the amalgamation is abandoned or, by the
terms of the agreement, will not proceed;
(e) the
arrangement in respect of which the notice of dissent was sent is abandoned or by its terms will not proceed;
(f) a
court permanently enjoins or sets aside the corporate action approved or authorized by the resolution or court order in respect of which
the notice of dissent was sent;
(g) with
respect to the notice shares, the dissenter consents to, or votes in favour of, the resolution in respect of which the notice of dissent
was sent;
(h) the
notice of dissent is withdrawn with the written consent of the company;
(i) the
court determines that the dissenter is not entitled to dissent under this Division or that the dissenter is not entitled to dissent with
respect to the notice shares under this Division.
Shareholders
entitled to return of shares and rights
247 If, under
section 244(4) or (5), 245(4)(a) or 246, this Division, other than this section, ceases to apply to a dissenter with respect to notice
shares,
(a) the
company must return to the dissenter each of the applicable share certificates, if any, sent under section 244(1)(b) or, if those share
certificates are unavailable, replacements for those share certificates,
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(b) the
dissenter regains any ability lost under section 244(6) to vote, or exercise or assert any rights of a Shareholder, in respect of the
notice shares, and
(c) the
dissenter must return any money that the company paid to the dissenter in respect of the notice shares under, or in purported compliance
with, this Division.
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APPENDIX
L
COMPARISON OF RIGHTS OF SILVERCREST SHAREHOLDERS AND COEUR STOCKHOLDERS
| |
SilverCrest
Shareholder Rights |
Coeur
Stockholder Rights |
| Authorized
Share Capital |
SilverCrest’s
authorized share capital consists of (i) an unlimited number of common shares without par value and (ii) an unlimited number of preferred
shares without par value. |
Coeur
is authorized by its certificate of incorporation to issue 610,000,000 shares, of which 600,000,000 shares shall be designated as
common stock, par value $0.01 per share, and 10,000,000 shares shall be designated as preferred stock, par value $1.00 per share.
If the Coeur Charter Amendment is approved by Coeur Stockholders at the Coeur Meeting, Coeur will be authorized to issue 910,000,000
shares, of which 900,000,000 shares shall be designated as common stock, par value $0.01 per share, and 10,000,000 shares shall be
designated as preferred stock, par value $1.00 per share. |
| Voting
Rights |
Every
shareholder entitled to vote on a matter has one vote per common share held. |
Each
holder of Coeur Shares entitled to vote at any meeting of Coeur Stockholders shall be entitled to one vote for each Coeur Share held
of record by such holder which has voting power upon the matter in question. |
| Shareholder
Approval of Business Combinations and Fundamental Changes |
Under the
BCBCA, certain extraordinary company alterations such as changes to authorized share structure, continuances out of province, certain
mergers, sales, leases or other dispositions of all or substantially all of the business of a company (other than in the ordinary
course of business) liquidations, dissolutions, and certain arrangements are required to be approved by special resolution.
A special
resolution is a resolution (i) passed by not less than two-thirds (66½%) of the votes cast by the shareholders who voted in
respect of the resolution at a meeting duly called and held for that purpose or (ii) signed by all shareholders entitled to vote
on the resolution.
In certain
cases, an action that prejudices, adds restrictions to or interferes with a right or special right attached to issued shares of a
class or series of shares must be approved separately by the holders of the class or series of shares being affected by special resolution.
Under the
BCBCA, arrangements are permitted and a company may make any proposal it considers appropriate “despite any other provision”
of the BCBCA. In general, a plan of arrangement is approved by a company’s board of directors and then is submitted to a court
for approval. It is typical for a company in such circumstances to apply to
a court initially for an interim order governing various procedural |
Under the
DGCL, a merger or consolidation, or a sale, lease, or exchange of all or substantially all of the assets of a corporation, or a dissolution
of the corporation, is generally required to be approved by the holders of a majority in voting power of the shares entitled to vote
on the matter, unless the certificate of incorporation provides for a higher voting threshold.
In addition,
under the DGCL, mergers in which one corporation owns 90% or more of each class of stock of a second corporation may be completed
without the vote of the second corporation’s board of directors or stockholders. The DGCL does not contain a procedure comparable
to a plan of arrangement under the BCBCA.
See also “Special
Vote Required for Combinations with Interested Shareholders” section below describing certain restrictions on business combinations
with interested stockholders.
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| |
SilverCrest
Shareholder Rights |
Coeur
Stockholder Rights |
| |
matters
prior to calling any security holder meeting to consider the proposed arrangement. Statutory arrangements involving shareholders (even
holders of shares not normally entitled to a vote) must be approved by those respective shareholders by a special resolution. The court
may, in respect of an arrangement proposed with persons other than shareholders and creditors, require that those persons approve the
arrangement in the manner and to the extent required by the court. The court determines to whom notice shall be given and whether, and
in what manner, approval of any person is to be obtained and also determines whether any shareholders may dissent from the proposed arrangement
and receive payment of the fair value of their shares. Following compliance with the procedural steps contemplated in any such interim
order (including as to obtaining security holder approval), the court would conduct a final hearing and approve or reject the proposed
arrangement.
If any provisions of
the arrangement will, upon taking effect, alter information shown in the corporate register, the company must file all necessary records
and information with the registrar to give effect to each such provision, and must also concurrently file a copy of the entered court
order.
|
|
| Special
Vote Required for Combinations with Interested Shareholders |
The BCBCA
does not contain a provision comparable to Section 203 of the DGCL with respect to business combinations. However, MI 61-101 contains
detailed requirements in connection with “related party transactions”. A related party transaction means, generally,
any transaction by which an issuer, directly or indirectly, consummates one or more specified transactions with a related party,
including purchasing or disposing of an asset, issuing securities or assuming liabilities. “Related party” as defined
in MI 61-101 includes (i) directors and senior officers of the issuer, (ii) holders of voting securities of the issuer carrying more
than 10% of the voting rights attached to all the issuer’s outstanding voting securities, and (iii) holders of a sufficient
number of any securities of the issuer to materially affect control of the issuer.
MI 61-101
requires, subject to certain exceptions, specific detailed disclosure in the information
circular sent to security holders in connection with a related party transaction where a
meeting is required and, subject to certain exceptions, the preparation of a formal valuation
of the subject |
Section 203
of the DGCL provides (in general) that a corporation may not engage in a business combination with an interested stockholder for
a period of three years after the time of the transaction in which the person became an interested stockholder. The prohibition on
business combinations with interested stockholders does not apply in some cases, including if: (i) the board of directors of the
corporation, prior to the time of the transaction in which the person became an interested stockholder, approves (a) the business
combination or (b) the transaction in which the stockholder becomes an interested stockholder; (ii) upon consummation of the transaction
which resulted in the stockholder becoming an interested stockholder, the interested stockholder owned at least 85% of the voting
stock of the corporation outstanding at the time the transaction commenced; or (iii) the board of directors and the holders of at
least two-thirds (66½%) of the
outstanding voting stock not owned by the interested stockholder approve the business combination
on or after the time of the |
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SilverCrest
Shareholder Rights |
Coeur
Stockholder Rights |
| |
matter
of the related party transaction and any non- cash consideration offered in connection therewith, and the inclusion of a summary of the
valuation in the proxy circular. MI 61-101 also requires, subject to certain exceptions, that an issuer not engage in a related party
transaction unless the disinterested shareholders of the issuer have approved the related party transaction by a simple majority of the
votes cast. |
transaction
in which the person became an interested stockholder.
For the purpose of Section
203, the DGCL generally defines an interested stockholder to include any person who, together with that person’s affiliates or
associates, (i) owns 15% or more of the outstanding voting stock of the corporation, or (ii) is an affiliate or associate of the corporation
and owned 15% or more of the outstanding voting stock of the corporation at any time within the previous three years. The restrictions
under Section 203 of the DGCL will not apply if the corporation’s original certificate of incorporation contains a provision expressly
electing not to be governed by these provisions or if the corporation’s certificate of incorporation or by-laws are amended to
contain such a provision or in cases where the corporation’s shares are not publicly held. None of these exceptions are applicable
to Coeur and Coeur is subject to Section 203 of the DGCL.
|
| Appraisal
Rights and Dissent Rights; Oppression Remedy; Compulsory Acquisition |
Appraisal
and Dissent Rights
The BCBCA
provides that shareholders of a company are entitled to exercise dissent rights in respect of certain matters and to be paid the
fair value of their shares in connection therewith. The dissent right is applicable where the company resolves to (i) alter its articles
to alter the restrictions on the powers of the company or on the business it is permitted to carry on; (ii) approve certain mergers;
(iii) approve an arrangement, where the terms of the arrangement permit dissent; (iv) sell, lease or otherwise dispose of all or
substantially all of its undertaking; or (v) continue the company into another jurisdiction.
The BCBCA’s
oppression remedy enables a court to make almost any order to rectify the matters complained of if the court is satisfied upon application
by a shareholder (as defined below) that the affairs of the company are being conducted in a manner that is oppressive, or that some
action has been or may be taken which is unfairly prejudicial. The applicant must be one of the persons being oppressed or prejudiced
and the application must be brought in a timely manner. A “shareholder” for the purposes of the oppression remedy
includes legal and beneficial owners of shares as well as any other person whom the court considers appropriate.
The oppression remedy
provides the court with extremely broad and flexible jurisdiction to
|
Under the
DGCL, a stockholder of a corporation does not have appraisal rights in connection with a merger or consolidation, if, among other
things: (i) the corporation’s shares are listed on a national securities exchange or held of record by more than 2,000 holders;
or (ii) the corporation will be the surviving corporation of the merger and no vote of its stockholders is required to approve the
merger. The DGCL grants appraisal rights only in the case of mergers or consolidations and not in the case of a sale or transfer
of assets or a purchase of assets for stock.
However, notwithstanding
the foregoing, a stockholder is entitled to appraisal rights in the case of a merger or consolidation if the stockholder is required
to accept in exchange for the shares anything other than: (i) shares of stock of the corporation surviving or resulting from the merger
or consolidation, or depositary receipts in respect thereof; (ii) shares of any other corporation, or depository receipts in respect
thereof, that on the effective date of the merger or consolidation will be either listed on a national securities exchange or held of
record by more than 2,000 holders; (iii) cash instead of fractional shares, or fractional depositary receipts, of the corporation;
or (iv) any combination of the foregoing.
Coeur’s shares are currently listed on
the NYSE.
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SilverCrest
Shareholder Rights |
Coeur
Stockholder Rights |
| |
intervene
in corporate affairs to protect shareholders. While conduct that is in breach of fiduciary duties of directors or that is contrary to
the legal right of a complainant will normally trigger the court’s jurisdiction under the oppression remedy, the exercise of that
jurisdiction does not depend on a finding of a breach of such legal and equitable rights.
Compulsory Acquisition
The BCBCA provides that,
in the event of a takeover offer, within four months after the making of the offer, the offer is accepted by the holders of not less
than 90% of the shares (other than the shares held by the offeror or an affiliate of the offeror) of any class of shares to which the
offer relates, the offeror is entitled, upon giving proper notice, to acquire (on the same terms on which the offeror acquired shares
under the take-over bid) the shares held by those holders of shares of that class who did not accept the offer. Offeree Shareholders
may apply to the courts, within two months of receiving notice, and the courts may set a different price or term of payment or make any
consequential order or direction as it considers appropriate.
|
There is no remedy under
the DGCL that is comparable to the BCBCA’s oppression remedy.
An entity owning at
least 90% of the outstanding shares of each class of stock of a corporation formed under the DGCL may merge with or into such Delaware
corporation by (a) authorizing such merger in accordance with the owning entity’s governing documents and the laws of the jurisdiction
under which such entity is formed or organized and (b) filing with the Delaware Secretary of State a certificate of such ownership and
merger, which shall state the terms and conditions of the merger, including the securities, cash, property, or rights to be issued, paid,
delivered or granted by the surviving constituent party upon surrender of each share of the corporation or corporations not owned by
the entity. Such a merger would not require the approval of the stockholders of the Delaware corporation; however, the owners of the
shares of stock in the Delaware corporation not owned by the merging entity would have appraisal rights as described above. |
| Shareholder
Consent to Action Without a Meeting |
Under
the BCBCA, shareholder action without a meeting may be taken by a consent resolution of shareholders provided that it satisfies all
the requirements relating to meetings of shareholders set forth in the Company’s articles, the BCBCA and the regulations. |
Under the
DGCL, unless otherwise provided in the certificate of incorporation, any action that can be taken at a meeting of the stockholders
may be taken without a meeting and without prior notice if written consent to the action is signed by the holders of outstanding
stock having the minimum number of votes necessary to authorize or take the action at a meeting of the stockholders.
Coeur’s
certificate of incorporation allows stockholder action by written consent.
|
| Special
Meetings of Shareholders |
Under
the BCBCA, the holders of not less than 5% of the issued shares of a company that carry the right to vote at a general meeting may
requisition that the directors call a meeting of shareholders. Upon meeting the technical requirements set out in the BCBCA, the
directors must call a meeting of shareholders to be held not more than four months
after receiving the requisition. If the directors do not call such a meeting within 21 days after receiving the requisition, the
requisitioning shareholders or any of them holding in aggregate more than 2.5% of the issued shares of the company that carry the
right to vote at general meetings may call the meeting. |
Under the
DGCL, a special meeting of stockholders may be called only by the board of directors or by persons authorized in the certificate
of incorporation or the by-laws.
Coeur’s
certificate of incorporation provides that special meetings of the stockholders may be called only by the board of directors or by the chair of the Board. |
| Distributions
and Dividends; |
Under
the BCBCA, a company may pay a dividend by issuing shares or warrants. A company may also |
Under
the DGCL, a corporation may, subject to any restrictions in its certificate of incorporation, |
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SilverCrest
Shareholder Rights |
Coeur
Stockholder Rights |
| Repurchases
and Redemptions |
pay a dividend in money or property unless
there are reasonable grounds for believing that the company is insolvent, or the payment of the dividend would render the company
insolvent.
Under the
BCBCA, the purchase or other acquisition by a company of its shares is generally subject to solvency tests similar to those applicable
to the payment of dividends, as set out above.
The BCBCA
provides that no special rights or restrictions attached to a series of shares confer on the series a priority in respect of dividends
or return of capital over any other series of shares of the same class. |
pay dividends out of surplus and, if there
is no surplus, out of net profits for the current and/or the preceding fiscal year. Surplus is defined in the DGCL as the excess
of the net assets over capital, as such capital may be adjusted by the board.
A Delaware
corporation may purchase or redeem shares of any class except when its capital is impaired or would be impaired by the purchase or
redemption. A corporation may, however, purchase or redeem out of capital, shares that are entitled upon any distribution of its
assets, whether by dividend or in liquidation, to a preference over another class or series of its shares, or, if no such shares
are outstanding, any of its shares, if the shares are to be retired and the capital reduced. |
| Number
of Directors; Vacancies on the Board of Directors |
The BCBCA
provides that a public company must have at least three directors. SilverCrest’s articles provide that if SilverCrest is a
public company, the numbers of directors must be the greater of three and the number most recently determined by an ordinary resolution
of Shareholders, or the number of directors set from time to time when retired directors are not replaced.
Under the
BCBCA, a vacancy among the directors created by the removal of a director may be filled by the shareholders at the meeting at which
the director is removed or, if not filled by the shareholders at such meeting, by the shareholders or by the remaining directors.
In the case of a casual vacancy under the BCBCA, the remaining directors may fill the vacancy. |
The DGCL provides
that the board of directors of a corporation shall consist of one or more members.
Coeur’s
certificate of incorporation and by-laws provide that subject to the rights of the holders of any series of preferred stock to elect
directors under specified circumstances, the board of directors shall consist of such number of directors as shall be determined
from time to time solely by resolution adopted by affirmative vote of a majority of the directors then in office.
Under the
DGCL, a vacancy or a newly created directorship may be filled by a majority of the remaining directors, although less than a quorum,
unless otherwise provided in the certificate of incorporation or by-laws.
Coeur’s
by-laws provide that subject to the rights of the holders of any one or more series of preferred stock then outstanding, newly created
directorships resulting from any increase in the authorized number of directors and any vacancies in the board of directors resulting
from death, resignation, retirement, disqualification, removal from office or other cause
may, unless otherwise required by law, be filled by the affirmative vote of a majority of the remaining directors then in office,
though less than a quorum, and any director so chosen shall hold office until the next election of directors and until his or her
successor shall be elected and qualified. |
| Constitution
and Residency of Directors |
The
BCBCA does not place any residency restrictions on the boards of directors. |
The
DGCL does not have any residency requirements, but a corporation can prescribe qualifications for directors under its certificate
of incorporation or bylaws. Neither Coeur’s |
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certificate of incorporation nor its by-laws provide for any such qualifications
for directors. |
| Removal
of Directors; Terms of Directors |
The BCBCA
and SilverCrest’s articles allow for the removal of a director by special resolution. If the director is convicted of an indictable
offence or ceases to be qualified to act as a director and does not promptly resign, the directors may remove that director before
the expiration of their term of office.
SilverCrest’s
articles provide that directors cease to hold office immediately before the election or appointment of directors at SilverCrest’s
annual general meeting, but are eligible to re-election or re-appointment at that meeting. |
Under
the DGCL, except in the case of a corporation with a classified board of directors or with cumulative voting, any director or the
entire board of directors may be removed, with or without cause, by the holders of a majority of the shares entitled to vote at an
election of directors. In the case of a corporation with a classified board of directors, stockholders may remove a director only
for cause unless the corporation’s certificate of incorporation provides that the directors may be removed with or without
cause. |
| Indemnification
of Directors and Officers |
Under the
BCBCA, a company may indemnify a director or officer, a former director or officer or a person who acts or acted at the company’s
request as a director or officer, or an individual acting in a similar capacity, of another entity (an “indemnifiable person”)
against all costs, charges and expenses, including an amount paid to settle an action or satisfy a judgment, reasonably incurred
by him or her in respect of any civil, criminal, administrative, investigative or other proceeding in which he or she is involved
because of that association with the company or other entity, if: (i) the individual acted honestly and in good faith with a view
to the best interests of such company or the other entity, as the case may be; and (ii) in the case of a proceeding other than a
civil proceeding, the individual had reasonable grounds for believing that the individual’s conduct was lawful. A company cannot
indemnify an indemnifiable person if it is prohibited from doing so under its articles, even if it had agreed to do so by an indemnification
agreement (provided that the articles prohibited indemnification when the indemnification agreement was made). A company may advance the expenses of an indemnifiable person as they
are incurred in an eligible proceeding only if the indemnifiable person has provided an undertaking
that, if it is ultimately determined that the payment of expenses was prohibited, the indemnifiable
person will repay any amounts advanced. On application from an indemnifiable person, a court
may make any order the court considers appropriate in respect of an eligible proceeding,
including the indemnification of penalties imposed or expenses incurred in any such proceedings
and the enforcement of an indemnification agreement. |
Under
the DGCL, a corporation is generally permitted to indemnify its directors and officers against expenses, judgments, fines and amounts
paid in settlement actually and reasonably incurred in connection with a third-party action, other than a derivative action, and against
expenses actually and reasonably incurred in the defense of a derivative action, provided that there is a determination that the individual
acted in good faith and in a manner reasonably believed to be in or not opposed to the best interests of the corporation and, in the
case of criminal proceedings, with no reason to believe that his or her actions were unlawful. That determination must be made by: (i)
a majority of the disinterested directors, even though less than a quorum; (ii) a committee of disinterested directors designated by
a majority vote of disinterested directors, even though less than a quorum; (iii) independent legal counsel; or (iv) a majority vote
of the stockholders at a meeting at which a quorum is present. Without court approval, however, no indemnification may be made in respect
of any derivative action in which an individual is adjudged liable to the corporation.
The DGCL requires indemnification of directors
and officers for expenses relating to a successful defense on the merits or otherwise of a derivative or third-party action. Under the
DGCL, a corporation may advance expenses relating to the defense of any proceeding to directors and officers contingent upon those individuals’
commitment to repay any advances if it is ultimately determined that those individuals are not entitled to be indemnified.
Coeur’s by-laws provide that each person
subject to a proceeding by reason of the fact that he or she is or was a director, officer or employee of
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As permitted by
the BCBCA, SilverCrest’s articles require SilverCrest to indemnify directors, officers, former directors, former officers, and
alternate directors of SilverCrest (and such individual’s respective heirs and personal representatives) against all eligible penalties
to which such person is or may be liable, and SilverCrest must, after the final disposition of any proceeding, pay the expenses actually
and reasonably incurred by such person in respect of that proceeding.
SilverCrest’s
articles require that indemnification be subject to the BCBCA, and as such any indemnification that SilverCrest provides is subject to
the same restrictions set out in the BCBCA.
|
Coeur
or while a director, officer or employee of Coeur is or was serving at the request of Coeur as a director, officer, employee, agent or
trustee of another corporation or of a partnership, joint venture, trust or other enterprise, including service with respect to an employee
benefit plan, or by reason of anything done or not done by him or her in any such capacity, shall be indemnified and held harmless by
Coeur to the fullest extent authorized by the DGCL against all expense, liability and loss (including attorneys’ fees, judgments,
fines, ERISA excise taxes or penalties and amounts paid in settlement) actually and reasonably incurred by such person in connection
therewith. In certain circumstances, Coeur will indemnify the person if that person initiated the proceeding if such proceeding, or part
thereof, was authorized or ratified by the Coeur Board.
|
| Limited
Liability of Directors |
Under
the BCBCA, a director is not liable for certain acts if the director relied, in good faith, on (i) financial statements of the company
represented to the director by an officer of the company or in a written report of the auditor of the company to fairly reflect the
financial position of the company, (ii) a written report of a lawyer, accountant, engineer, appraiser or other person whose profession
lends credibility to a statement made by that person, (iii) a statement of fact represented to the director by an officer of the
company to be correct, or (iv) any record, information or representation that the court considers provides reasonable grounds for
the actions of the director, whether or not that record was forged, fraudulently made or inaccurate. Further, a director is not liable
for certain acts if the director did not know and could not reasonably have known that the act done by the director or authorized by the resolution voted
for or consented to by the director was contrary to the BCBCA. |
The DGCL permits
the adoption of a provision in a corporation’s certificate of incorporation limiting or eliminating the monetary liability
of a director to a corporation or its stockholders by reason of a director’s breach of the fiduciary duty of care. The DGCL
does not permit any limitation of the liability of a director for: (i) breaching the duty of loyalty to the corporation or its stockholders;
(ii) failing to act in good faith; (iii) engaging in intentional misconduct or a known violation of law; (iv) obtaining an improper
personal benefit from the corporation; or (v) paying a dividend or approving a stock repurchase or redemption that was illegal under
applicable law.
Coeur’s
certificate of incorporation provides that to the fullest extent permitted by the DGCL,
no director of Coeur shall be personally liable to Coeur or its stockholders for monetary damages for breach of fiduciary duty as
a director. |
| Derivative
Actions |
A
SilverCrest Shareholder (including a beneficial shareholder and any other person that the court considers to be an appropriate person
to make such an application) may apply to the court for leave to bring an action in the name of and on behalf of SilverCrest or any subsidiary,
or to intervene in an existing action to which SilverCrest or a subsidiary is a party, for the purpose of prosecuting or defending an
action on behalf of SilverCrest or its subsidiary. Under the BCBCA, the court may grant leave if: (i) the shareholder has made reasonable
efforts to cause the directors of the company to prosecute or defend the action; |
Under
the DGCL, a stockholder bringing a derivative suit must have been a stockholder at the time of the wrong complained of or the stockholder
must have received stock in the corporation by operation of law from a person who was such a stockholder at the time of the wrong
complained of. There is no requirement under the DGCL to advance the expenses of a lawsuit to a stockholder bringing a derivative
suit. |
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(ii) notice of the application for leave
has been given to the company or its subsidiary and any other person that the court may order; (iii) the shareholder is acting in
good faith; and (iv) it appears to the court to be in the interests of the company or its subsidiary for the action to be brought,
prosecuted or defended.
Under the
BCBCA, the court in a derivative action may make any order it determines to be appropriate. In addition, under the BCBCA, a court
may order a company or its subsidiary to pay the shareholder’s interim costs, including legal fees and disbursements. However,
the shareholder may be held accountable for the costs on final disposition of the action. |
|
| Advance
Notification Requirements for Proposals of Shareholders/ Stakeholders |
Under the
BCBCA, a proposal may be made by certain registered or beneficial holders of shares entitled to be voted at an annual meeting of
shareholders. To be eligible to submit such a proposal, a shareholder must be the registered or beneficial holder of, or have the
support of the registered or beneficial holders of, (i) at least 1% of the total number of outstanding voting shares of the company;
or (ii) voting shares whose fair market value is at least $2,000. Such registered or beneficial holder(s) must have held such shares
for an uninterrupted period of at least two years immediately prior to the date of the signing of the proposal and such shareholder
shall not have, within two years before the date of the signing of the proposal, failed to present, in person or by proxy, at an
annual general meeting, an earlier proposal submitted by such shareholder in response to which the company complied with its
obligations under the BCBCA. The proposal must be accompanied by a declaration including the name and address of the person
submitting the proposal, the names and addresses of the person’s supporters and the number of shares of the company, carrying
the right to vote at annual general meetings that are owned by such person(s).
If the proposal is submitted at least three months
before the anniversary date of the previous annual meeting and the proposal meets other specified requirements, then the company shall
either set out the proposal, including the names and mailing addresses of the submitting person and supporters, in the proxy circular
of the company or attach the proposal thereto. In addition, if provided by the person submitting the proposal, the company shall include
in or attach to the proxy circular a statement in support of the
|
Under
Coeur’s by-laws, for director nominations or other business to be properly brought before an annual meeting by a stockholder,
the stockholder must have given timely notice thereof in writing to the Secretary and, in the case of business other than director
nominations, such business must be a proper subject for stockholder action. To be timely, a stockholder’s notice must be delivered
to the Secretary at the principal executive offices of Coeur not later than the close of business on the 90th day nor
earlier than the close of business on the 120th day prior to the first anniversary of the preceding year’s annual
meeting; provided, however, that in the event that the date of the annual meeting is more than 30 days before or more than 70 days
after such anniversary date,
or if no annual meeting was held in the preceding year, notice by the stockholder to be timely must be so delivered not earlier than
the close of business on the 120th day prior to such annual meeting and not later than the close of business on the later
of the 90th day prior to such annual meeting or the 10th day following the date on which public announcement
of the date of such meeting is first made by Coeur. The notice to be given must be in the form described in Coeur’s by-laws. |
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proposal by the person and the name and address of such person.
If the submitter
is a qualified shareholder at the time of the annual general meeting to which its proposal relates, the company must allow the submitter
to present the proposal, in person or by proxy, at such meeting. If two or more proposals received by the company in relation to the
same annual general meeting are substantially the same, the company only needs to comply with such requirements in relation to the first
proposal received and not any others. The company may also refuse to process a proposal in certain other circumstances including when
the directors have called an annual general meeting to be held after the date the proposal is received and have sent a notice of meeting,
substantially the same proposal was submitted to shareholders in a notice of meeting or an information circular relating to an annual
general meeting of shareholders held within five years preceding the receipt of the request and the proposal did not obtain the prescribed
level of support or a proposal that deals with matters beyond the company’s power to implement.
If a company refuses
to process a proposal, the company shall notify the person making such proposal in writing within 21 days after its receipt of the proposal
of its decision in relation
to the proposal and the reasons therefor. In any such event, the person submitting the proposal may make application to a court for
a review of the company’s decision and a court may restrain the holding of the annual general meeting and make any further
order it considers appropriate. In addition, a company may apply to a court for an order permitting the company to refrain from processing
the proposal and the court may make such order as it considers appropriate.
|
|
| Inspection
of Books and Records |
Under the BCBCA, directors and shareholders may,
without charge, inspect certain records of the company. Former shareholders and directors may also inspect certain records, free of charge,
but only those records pertaining to the times that they were shareholders or directors.
Public companies must allow all persons to inspect
certain records of the company free of charge.
As permitted by the BCBCA, SilverCrest’s
articles prohibit shareholders from inspecting or obtaining any accounting records of the company, unless the directors determine otherwise,
or |
Under the DGCL, any stockholder, in person or by attorney or other agent, may, upon written demand under oath, inspect the
corporation’s books and records for a proper purpose. |
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unless otherwise determined by ordinary resolution. |
|
| Amending
of Government Documents |
Under the
BCBCA, a company may amend its articles or notice of articles by (i) the type of resolution specified in the BCBCA, (ii) if the BCBCA
does not specify a type of resolution, then by the type specified in the company’s articles, or (iii) if the company’s
articles do not specify a type of resolution, then by special resolution. The BCBCA permits many substantive changes to a company’s
articles (such as a change in the company’s authorized share structure or a change in the special rights or restrictions that
may be attached to a certain class or series of shares) to be changed by the resolution specified in that company’s articles.
SilverCrest’s
articles provide that subject to the BCBCA, a change of the company’s name, a change to the company’s articles or notice
of articles, certain changes to the company’s share structure and any creation or alteration of special rights and restrictions
to a series or class of shares be done by way of directors’ resolution or ordinary resolution, as determined by the directors.
The articles also provide that, if the BCBCA or the articles do not
specify the type of resolution required for a particular change to its articles, the company may effect such change by ordinary resolution. |
Under
the DGCL, a corporation’s certificate of incorporation may be amended if: (i) the board of directors sets forth the proposed amendment
in a resolution, declares the advisability of the amendment and directs that it be submitted to a vote at a meeting of stockholders;
and (ii) the holders of a number of shares of stock as required by the DGCL or such corporation’s certificate of incorporation
(as applicable) to approve the amendment. In addition, under the DGCL, class voting rights exist with respect to, among other things,
amendments to the certificate of incorporation that adversely affect the terms of the shares of a class. Class voting rights do not exist
as to other extraordinary matters, unless the certificate of incorporation provides otherwise.
Under the
DGCL, the board of directors may amend a corporation’s by-laws if so authorized in the certificate of incorporation.
Under the
DGCL, stockholders also may amend a corporation’s by-laws. Under Coeur’s certificate of incorporation, the affirmative
vote of the holders of at least a majority in voting power of the issued and outstanding stock entitled to vote generally in the election
of directors, voting together as a single class, shall be required for the stockholders to adopt, amend or repeal any provision of
the by-laws of Coeur. |
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Take Action
and Vote Today
The
SilverCrest Board of Directors Recommends a Vote FOR the Arrangement Resolution
Vote
Well in Advance of the Proxy Deadline on February 4, 2025 at 10:00 a.m. (Vancouver time)
| |
|
Registered
Shareholders and Optionholders |
Beneficial
Shareholders
(Common
Shares held with a broker, bank or other intermediary.) |
|
Internet |
www.investorvote.com |
www.proxyvote.com |
|
Telephone |
1-866-732-8683 |
Dial the applicable number
listed on the voting instruction form. |
|
Mail |
Return the voting instruction
form in the enclosed postage paid envelope. |
Return the voting instruction
form in the enclosed postage paid envelope. |
Questions May
Be Directed to the Proxy Solicitation Agent:
Laurel Hill
Advisory Group
North America
Toll Free: 1.877.452.7184
Outside North America:
416.304.0211
Email: assistance@laurelhill.com
EXHIBIT 99.2
SILVERCREST METALS INC. Security
Class Holder Account Number ------- Fold Form of Proxy - Special Meeting to be held on February 6, 2025 This Form of Proxy is solicited
by and on behalf of Management. Notes to proxy 1. Every holder has the right to appoint some other person or company of their choice,
who need not be a holder, to attend and act on their behalf at the meeting or any adjournment or postponement thereof. If you wish to
appoint a person or company other than the Management Nominees whose names are printed herein, please insert the name of your chosen
proxyholder in the space provided (see reverse). 2. If the securities are registered in the name of more than one owner (for example,
joint ownership, trustees, executors, etc.), then all those registered should sign this proxy. If you are voting on behalf of a corporation
or another individual you may be required to provide documentation evidencing your power to sign this proxy with signing capacity stated.
3. This proxy should be signed in the exact manner as the name(s) appear(s) on the proxy. 4. If a date is not inserted in the space
provided on the reverse of this proxy, it will be deemed to bear the date on which it was mailed to the holder by Management. 5. The
securities represented by this proxy will be voted as directed by the holder, however, if such a direction is not made in respect of
any matter, and the proxy appoints the Management Nominees listed on the reverse, this proxy will be voted as recommended by Management.
6. The securities represented by this proxy will be voted in favour, or withheld from voting, or voted against each of the matters
described herein, as applicable, in accordance with the instructions of the holder, on any ballot that may be called for. If you have
specified a choice with respect to any matter to be acted on, the securities will be voted accordingly. 7. This proxy confers discretionary
authority in respect of amendments or variations to matters identified in the Notice of Meeting and Management Information Circular or
other matters that may properly come before the meeting or any adjournment or postponement thereof, unless prohibited by law. 8. This
proxy should be read in conjunction with the accompanying documentation provided by Management. Proxies submitted must be received by
10:00 am (Vancouver Time), on February 4, 2025. VOTE USING THE TELEPHONE OR INTERNET 24 HOURS A DAY 7 DAYS A WEEK! ------- Fold
• Call the number listed BELOW from a touch tone telephone. 1-866-732-VOTE (8683) Toll Free • Go to the following
web site: www.investorvote.com • Smartphone? Scan the QR code to vote now. • You can enroll to receive future securityholder
communications electronically by visiting www.investorcentre.com. If you vote by telephone or the Internet, DO NOT mail back this proxy.
Voting by mail may be the only method for securities held in the name of a corporation or securities being voted on behalf of another
individual. Voting by mail or by Internet are the only methods by which a holder may appoint a person as proxyholder other than the Management
Nominees named on the reverse of this proxy. Instead of mailing this proxy, you may choose one of the two voting methods outlined above
to vote this proxy. To vote by telephone or the Internet, you will need to provide your CONTROL NUMBER listed below. CONTROL NUMBER
Appointment of Proxyholder
I/We being registered shareholder(s) of SilverCrest Metals Inc. (the “Company”) hereby appoint: N. Eric Fier, Chief Executive
Officer, or failing this person, Christopher Ritchie, President, or failing this person, Robert Doyle, Interim Chief Financial Officer
(the "Management Nominees") OR Print the name of the person you are appointing if this person is someone other than the
Management Nominees listed herein. as my/our proxyholder with full power of substitution and to attend, act and to vote for and on behalf
of the holder in accordance with the following direction (or if no directions have been given, as the proxyholder sees fit) and on all
other matters that may properly come before the Special Meeting of shareholders of the Company to be held at the offices of Cassels Brock
& Blackwell LLP at Suite 2200, RBC Place, 885 West Georgia Street, Vancouver, BC V6C 3E8 on February 6, 2025 at 10:00 am (Vancouver
Time), and at any adjournment or postponement thereof. VOTING RECOMMENDATIONS ARE INDICATED BY HIGHLIGHTED TEXT OVER THE BOXES. 1. Arrangement
Resolution To consider and, if deemed acceptable, to pass, with or without variation, a special resolution approving a statutory plan
of arrangement under Division 5 of Part 9 of the Business Corporations Act (British Columbia) pursuant to which Coeur Mining, Inc. will
indirectly, among other things, acquire all of the issued and outstanding common shares of SilverCrest Metals Inc., the full text of
which is set forth in Appendix A to the accompanying management information circular of SilverCrest Metals Inc. ------- Fold -------
Fold Signature of Proxyholder I/We authorize you to act in accordance with my/our instructions set out above. I/We hereby revoke any
proxy previously given with respect to the Meeting. If no voting instructions are indicated above, and the proxy appoints the Management
Nominees, this Proxy will be voted as recommended by Management. Signature(s) Date Y S V Q 3 7 0 5 9 7 A R 0
SILVERCREST
METALS INC. Security Class Holder Account Number ------- Fold Form of Proxy - Special Meeting to be held on February 6, 2025 This Form
of Proxy is solicited by and on behalf of Management. Notes to proxy 1. Every holder has the right to appoint some other person or
company of their choice, who need not be a holder, to attend and act on their behalf at the meeting or any adjournment or postponement
thereof. If you wish to appoint a person or company other than the Management Nominees whose names are printed herein, please insert
the name of your chosen proxyholder in the space provided (see reverse). 2. If the securities are registered in the name of more than
one owner (for example, joint ownership, trustees, executors, etc.), then all those registered should sign this proxy. If you are voting
on behalf of a corporation or another individual you may be required to provide documentation evidencing your power to sign this proxy
with signing capacity stated. 3. This proxy should be signed in the exact manner as the name(s) appear(s) on the proxy. 4. If a
date is not inserted in the space provided on the reverse of this proxy, it will be deemed to bear the date on which it was mailed to
the holder by Management. 5. The securities represented by this proxy will be voted as directed by the holder, however, if such a
direction is not made in respect of any matter, and the proxy appoints the Management Nominees listed on the reverse, this proxy will
be voted as recommended by Management. 6. The securities represented by this proxy will be voted in favour, or withheld from voting,
or voted against each of the matters described herein, as applicable, in accordance with the instructions of the holder, on any ballot
that may be called for. If you have specified a choice with respect to any matter to be acted on, the securities will be voted accordingly.
7. This proxy confers discretionary authority in respect of amendments or variations to matters identified in the Notice of Meeting
and Management Information Circular or other matters that may properly come before the meeting or any adjournment or postponement thereof,
unless prohibited by law. 8. This proxy should be read in conjunction with the accompanying documentation provided by Management.
Proxies submitted must be received by 10:00 am (Vancouver Time), on February 4, 2025. VOTE USING THE TELEPHONE OR INTERNET 24 HOURS A
DAY 7 DAYS A WEEK! ------- Fold • Call the number listed BELOW from a touch tone telephone. 1-866-732-VOTE (8683) Toll Free
• Go to the following web site: www.investorvote.com • Smartphone? Scan the QR code to vote now. If you vote by telephone
or the Internet, DO NOT mail back this proxy. Voting by mail may be the only method for securities held in the name of a corporation
or securities being voted on behalf of another individual. Voting by mail or by Internet are the only methods by which a holder may appoint
a person as proxyholder other than the Management Nominees named on the reverse of this proxy. Instead of mailing this proxy, you may
choose one of the two voting methods outlined above to vote this proxy. To vote by telephone or the Internet, you will need to provide
your CONTROL NUMBER listed below. CONTROL NUMBER
Appointment
of Proxyholder I/We being optionholder(s) of securities of SilverCrest Metals Inc. (the “Company”) hereby appoint: N. Eric
Fier, Chief Executive Officer, or failing this person, Christopher Ritchie, President, or failing this person, Robert Doyle, Interim
Chief Financial Officer (the "Management Nominees") OR Print the name of the person you are appointing if this person is
someone other than the Management Nominees listed herein. as my/our proxyholder with full power of substitution and to attend, act and
to vote for and on behalf of the holder in accordance with the following direction (or if no directions have been given, as the proxyholder
sees fit) and on all other matters that may properly come before the Special Meeting of shareholders of the Company to be held at the
offices of Cassels Brock & Blackwell LLP at Suite 2200, RBC Place, 885 West Georgia Street, Vancouver, BC V6C 3E8 on February 6,
2025 at 10:00 am (Vancouver Time), and at any adjournment or postponement thereof. VOTING RECOMMENDATIONS ARE INDICATED BY HIGHLIGHTED
TEXT OVER THE BOXES. 1. Arrangement Resolution To consider and, if deemed acceptable, to pass, with or without variation, a special resolution
approving a statutory plan of arrangement under Division 5 of Part 9 of the Business Corporations Act (British Columbia) pursuant to
which Coeur Mining, Inc. will indirectly, among other things, acquire all of the issued and outstanding common shares of SilverCrest
Metals Inc., the full text of which is set forth in Appendix A to the accompanying management information circular of SilverCrest Metals
Inc. ------- Fold ------- Fold Signature of Proxyholder I/We authorize you to act in accordance with my/our instructions set out above.
I/We hereby revoke any proxy previously given with respect to the Meeting. If no voting instructions are indicated above, and the proxy
appoints the Management Nominees, this Proxy will be voted as recommended by Management. Signature(s) Date
Y S V
Q 3 7 0 5 9 8 A R 0
EXHIBIT 99.3
SILVERCREST
METALS INC. SPECIAL MEETING THURSDAY, FEBRUARY 06, 2025 AT 10:00 A.M. PST FOR HOLDERS AS OF DECEMBER 19, 2024 FEBRUARY 04, 2025 3 3 S05489-
E 1 OF 1 828363101 IF YOU WISH TO ATTEND THE MEETING OR DESIGNATE ANOTHER PERSON TO ATTEND, VOTE AND ACT ON YOUR BEHALF AT THE MEETING,
OR ANY ADJOURNMENT OR POSTPONEMENT THEREOF, OTHER THAN THE PERSON(S) SPECIFIED ABOVE, PRINT YOUR NAME OR THE NAME OF THE OTHER PERSON
ATTENDING THE MEETING IN THE SPACE PROVIDED HEREIN. UNLESS YOU INSTRUCT OTHERWISE, THE PERSON WHOSE NAME IS WRITTEN IN THIS SPACE WILL
HAVE FULL AUTHORITY TO ATTEND, VOTE AND OTHERWISE ACT IN RESPECT OF ALL MATTERS THAT MAY COME BEFORE THE MEETING OR ANY ADJOURNMENT OR
POSTPONEMENTTHEREOF, EVEN IF THESE MATTERS ARE NOT SET OUT IN THE FORM OR THE CIRCULAR. FOR VIRTUAL MEETINGS, YOU MAY NEED TO COMPLETE
ADDITIONAL INFORMATION OR TAKE ADDITIONAL ACTION FOR YOU OR YOUR APPOINTEE TO ATTEND THE MEETING. PLEASE PRINT APPOINTEE NAME ABOVE
N. Eric Fier, Christopher Ritchie, Robert Doyle 1 To consider and, if deemed acceptable, to pass, with or without RECOMMENDATION:
FOR variation, a special resolution approving a statutory plan of arrangement under Division 5 of Part 9 of the Business Corporations
Act (British Columbia) pursuant to which Coeur Mining, Inc. will, indirectly among other things, acquire all of the issued and outstanding
common shares of SilverCrest Metals Inc., the full text of which is set forth in Appendix A to the accompanying management information
circular of SilverCrest Metals Inc. FOR AGAINST * ISSUER CONFIRMATION COPY - INFO ONLY *
2601
14TH AVENUE MARKHAM, ON L3R 0H9 SPECIAL MEETING SILVERCREST METALS INC. THURSDAY, FEBRUARY 06, 2025 AT 10:00 A.M. PST WE NEED TO RECEIVE
YOUR VOTING INSTRUCTIONS AT LEAST ONE BUSINESS DAY BEFORE THE PROXY DEPOSIT DATE. CONTROL NO.:➔ PROXY DEPOSIT DATE: The control
number has been assigned to you to identify your shares for voting. You must keep your control number confidential and not disclose it
to others other than when you vote using one of the voting options set out on this form. Should you send this form or provide your control
number to others, you are responsible for any subsequent voting of, or subsequent inability to vote, your shares. Dear Client: A meeting
is being held for securityholders of the above noted issuer. 1. You are receiving this Voting Instruction Form and the enclosed meeting
materials at the direction of the issuer as a beneficial owner of securities. You are a beneficial owner because we, as your intermediary,
hold the securities in an account for you and the securities are not registered in your name. 2. Votes are being solicited by or on behalf
of the management of the issuer. 3. Even if you have declined to receive materials, a reporting issuer is entitled to deliver these materials
to you and if requested to do so, it is our responsibility to forward them. These materials are being sent at no cost to you, in the
language you requested, if available. 4. Unless you attend the meeting and vote in person or virtually (as applicable), your securities
can only be voted through us as registered holder or proxyholder of the registered holder in accordance with your instructions. We cannot
vote for you if we do not receive your voting instructions. Please provide your voting instructions to us promptly using one of the available
voting methods or complete and return this form. We will submit a proxy vote on your behalf according to the voting instructions you
provide, unless you elect to attend the meeting and vote in person or virtually (as applicable). 5. When you give us your voting instructions,
you acknowledge that: • You are the beneficial owner or are authorized to provide these voting instructions; and • You have
read the material and the voting instructions on this form. 6. You may not present this Voting Instruction Form at the meeting in order
to vote. 7. To attend and vote your shares at the meeting: • Write your name or the name of your designate to act on your behalf
on the "Appointee" line on the other side of this form, sign and date the form, and return it by mail, or • Go to ProxyVote.com
(if available) and insert the name in the "Change Appointee(s)" section on the voting site. • For virtual meetings, you
may need to complete additional information or take additional action for you or your Appointee to attend the meeting. Refer to the meeting
material accompanying this voting instruction form for details. You, or your designate, as the named "Appointee", must attend
the meeting for your vote to be counted. 8. Unless prohibited by law or you instruct otherwise, the Appointee(s) or the person whose
name is written in the space provided will have full authority to attend and otherwise act at. and present matters to the meeting and
any adjournment or postponement thereof, and vote on all matters that are brought before the meeting or any adjournment or postponement
thereof, even if these matters are not set out in this form or in the management proxy circular. Consult a legal advisor if you wish
to modify the authority of that person in any way. If you require assistance, please contact the person who services your account. 9.
If these voting instructions are given on behalf of a body corporate, set out the full legal name of the body corporate, the name and
position of the person giving voting instructions on behalf of the body corporate and the address for service of the body corporate.
10. If the items listed in the management proxy circular are different from the items listed on the other side of this form, the management
proxy circular will be considered correct. 11. The Appointee named in this form will exercise the voting rights attached to the securities
in accordance with the instructions given. In the absence of any specific instructions as to voting being provided by you on this form,
the item(s) will be voted as recommended on the reverse of this form or as stated in the management proxy circular, except in the case
of your appointment of an Appointee. 12. This Voting Instruction Form should be read in conjunction with the accompanying management
proxy circular. 13. To ensure that your instructions are received in sufficient time to be processed, please ensure that the Voting Instruction
Form is received by us or voted online at least one business day before the proxy deposit date noted above or the proxy deadline specified
in the management proxy circular. Voting instructions received on the proxy deposit date or later may not be able to be included in the
final tabulation. This Voting Instruction Form confers discretionary authority to vote on such other business as may properly come before
the meeting or any adjournment thereof. If you have any questions or require help, please contact the person who services your account.
Disclosure of Information - Electing to Receive Financial Statements or Reguesting Meeting Materials By electing to receive the financial
statements or requesting meeting materials, your name and address may be provided to the reporting issuer (or its agent) for mailing
purposes. SILVERCREST METALS INC. SUITE 501-570 GRANVILLE STREET VANCOUVER, BC V6C 3P1 CANADA Offices of Cassels Brock & Blackwell
LLP Suite 2200, RBC Place 885 West Georgia Street Vancouver, BC V6C 3E8 FEBRUARY 04, 2025
EXHIBIT 99.4
THE INSTRUCTIONS ACCOMPANYING
THIS LETTER OF TRANSMITTAL SHOULD BE READ CAREFULLY BEFORE THIS LETTER OF TRANSMITTAL IS COMPLETED. YOU ARE STRONGLY URGED TO
READ THE ACCOMPANYING MANAGEMENT INFORMATION CIRCULAR BEFORE COMPLETING THIS LETTER OF TRANSMITTAL. THE DEPOSITARY OR YOUR BROKER OR
OTHER FINANCIAL ADVISOR WILL ASSIST YOU IN COMPLETING THIS LETTER OF TRANSMITTAL. ALL DEPOSITS UNDER THIS LETTER OF TRANSMITTAL ARE
IRREVOCABLE AND MAY NOT BE WITHDRAWN.
THIS LETTER OF TRANSMITTAL IS FOR USE ONLY
IN CONJUNCTION WITH THE PLAN OF ARRANGEMENT INVOLVING SILVERCREST METALS INC., ITS SECURITYHOLDERS, 1504648 B.C. UNLIMITED LIABILITY COMPANY
AND COEUR MINING, INC.
THIS LETTER OF TRANSMITTAL MUST BE VALIDLY
COMPLETED, DULY EXECUTED AND RETURNED TO THE DEPOSITARY, COMPUTERSHARE INVESTOR SERVICES INC. IT IS IMPORTANT THAT YOU VALIDLY COMPLETE,
DULY EXECUTE AND RETURN THIS LETTER OF TRANSMITTAL ON A TIMELY BASIS IN ACCORDANCE WITH THE INSTRUCTIONS CONTAINED HEREIN.
LETTER OF TRANSMITTAL
FOR COMMON SHARES
OF
SILVERCREST METALS INC.
This Letter of Transmittal, properly completed
and duly executed, together with all other required documents, must accompany certificate(s) or Direct Registration System advice(s) (“DRS
Advice(s)”) for common shares (the “SilverCrest Shares”) of SilverCrest Metals Inc. (“SilverCrest”)
deposited in connection with the proposed arrangement (the “Arrangement”) involving SilverCrest and Coeur Mining, Inc.
(“Coeur”) pursuant to an arrangement agreement dated October 3, 2024 (the “Arrangement Agreement”),
a copy of which is available under SilverCrest’s profile on SEDAR+ at www.sedarplus.ca and on EDGAR at http://www.sec.gov .
The Arrangement is being submitted for approval at the special meeting of securityholders of SilverCrest that is scheduled to be held
on February 6, 2025, or any adjournment or postponement thereof (the “Meeting”), as more particularly described in
the management information circular of SilverCrest dated January 8, 2025 (the “Circular”).
Pursuant to the Arrangement, Coeur, through
1504648 B.C. Unlimited Liability Company, a wholly-owned subsidiary of Coeur (“Coeur Canadian Sub”) will acquire all
of the issued and outstanding SilverCrest Shares, and Shareholder will be entitled to receive 1.6022 shares of Coeur common stock (each
whole share, a “Coeur Share”) in exchange for each one (1) SilverCrest Share (the “Consideration”),
subject to adjustment pursuant to section 3.4 of the plan of arrangement (the “Plan of Arrangement”). Coeur will not
issue any fractional Coeur Shares in connection with the Arrangement. Where the aggregate number of Coeur Shares issuable to a Shareholder
as Consideration would result in a fraction of a Coeur Share being issuable, such Shareholder shall receive the nearest whole number of
Coeur Shares. For greater certainty, where such fractional interest is greater than or equal to 0.5, the number of Coeur Shares to be
issued will be rounded up to the nearest whole number, and where such fractional interest is less than 0.5, the number of Coeur Shares
to be issued will be rounded down to the nearest whole number. Shareholders should refer to the full text of the Plan of Arrangement which
is appended to the Circular as Appendix B.
Capitalized terms used but not defined in this
Letter of Transmittal have the meanings set out in the Circular. Registered Shareholders are encouraged to carefully review the Circular
in its entirety and should consult their own tax advisors prior to submitting a Letter of Transmittal.
The Effective Date of the Arrangement is
currently expected to occur late in the first quarter of 2025, after all conditions to completion of the Arrangement have been satisfied
or waived. COMPLETION OF THE ARRANGEMENT IS SUBJECT TO THE SATISFACTION OR WAIVER OF CERTAIN CONDITIONS. NO PAYMENT OF THE CONSIDERATION
WILL BE MADE PRIOR TO THE EFFECTIVE TIME. All deposits made under this Letter of Transmittal are irrevocable unless the Arrangement is
not completed and the Arrangement Agreement is terminated in accordance with its terms.
In order for Registered Shareholders to
receive the Consideration, Registered Shareholders are required to deposit the certificate(s) representing the SilverCrest Shares (the
“Share Certificate(s)”) or DRS Advice(s), as applicable, held by them with Computershare Investor Services Inc. (the “Depositary”
or “Computershare”). This Letter of Transmittal, properly completed and duly executed, together with all other required documents,
must accompany all Share Certificate(s) or DRS Advice(s) for SilverCrest Shares deposited.
This Letter of Transmittal is for use by
Registered Shareholders only and is not to be used by non-registered, beneficial holders of SilverCrest Shares. A non-registered holder
does not have SilverCrest Shares registered in its name; rather, such SilverCrest Shares are registered in the name of the brokerage firm,
bank, trust company or other intermediary through which it purchased or holds the SilverCrest Shares or in the name of a clearing agency
(such as CDS Clearing and Depository Services Inc.) of which the intermediary is a participant. Nonregistered holders of SilverCrest Shares
should contact the brokerage firm, bank, trust company or other intermediary which holds the SilverCrest Shares on their behalf with respect
to the process of exchange.
Please note that the delivery of this Letter
of Transmittal, together with your Share Certificate(s) or DRS Advice(s) representing your SilverCrest Shares, as applicable, does not
constitute a vote in favour of the Arrangement. To exercise your right to vote at the Meeting you must attend the Meeting in person or
complete and return the form of proxy that accompanied the Circular by 10:00 a.m. (Pacific Time) on February 4, 2025 or 48 hours (excluding
Saturdays, Sundays and holidays) prior to the time of any adjournment or postponement of the Meeting, in each case in accordance with
the instructions provided in the Circular.
Whether or not the undersigned delivers
the required documentation to the Depositary, as of the Effective Time, the undersigned will cease to be a holder of SilverCrest Shares
and, subject to the ultimate expiry deadline identified below, will only be entitled to receive the Consideration to which the undersigned
is entitled under the Arrangement. IF A REGISTERED SHAREHOLDER DOES NOT DELIVER THIS LETTER OF TRANSMITTAL, THEIR SHARE CERTIFICATE(S)
OR DRS ADVICE(S) REPRESENTING SILVERCREST SHARES, AS APPLICABLE, AND ALL OTHER REQUIRED DOCUMENTS TO THE DEPOSITARY ON OR BEFORE THE SIXTH
ANNIVERSARY OF THE EFFECTIVE DATE, SUCH REGISTERED SHAREHOLDER WILL LOSE THEIR RIGHT TO RECEIVE ANY CONSIDERATION FOR THEIR SILVERCREST
SHARES.
Upon receipt of this Letter of Transmittal
duly completed and signed, the Share Certificate(s) or DRS Advice(s) representing the SilverCrest Shares deposited herewith and all other
required documents, and following the Effective Date, the Depositary will send to the undersigned Share Certificate(s) or DRS Advice(s)
representing that number of Coeur Shares to which the undersigned is entitled under the Arrangement.
Please read the instructions set out below
carefully before completing this Letter of Transmittal. Delivery of this Letter of Transmittal to an address other than as set forth
herein will not constitute a valid delivery. If SilverCrest Shares are registered in different names, a separate Letter of Transmittal
must be submitted for each different registered owner. See section 5(b) of the Instructions.
| TO: |
SILVERCREST METALS INC. |
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| AND TO: |
COEUR MINING, INC. |
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| AND TO: |
1504648 B.C. UNLIMITED LIABILITY COMPANY |
| |
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| AND TO: |
COMPUTERSHARE INVESTOR SERVICES INC. at its offices set out herein. |
In connection with the Arrangement being considered
for approval at the Meeting, the undersigned delivers to you the enclosed Share Certificate(s) or DRS Advice(s) for SilverCrest Shares.
The following are the details of the enclosed Share Certificate(s) or DRS Advice(s):
| Certificate Number(s) or DRS Holder Account Numbers |
Name in Which Registered |
Number of SilverCrest Shares Deposited |
| |
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The undersigned transmits herewith the Share
Certificate(s) or DRS Advice(s) described above for cancellation upon the Arrangement becoming effective.
The undersigned acknowledges receipt of the
Circular and represents and warrants that, as of the date hereof and as of the Effective Time:
| (a) | the undersigned is, and will immediately prior to the Effective Time be, the registered and legal owner
of, and has, and will immediately prior to the Effective Time have, good right and title and sufficient authority to deposit, sell and
transfer the SilverCrest Shares represented by the enclosed Share Certificate(s) or DRS Advice(s) (the “Deposited Shares”); |
| (b) | the Deposited Shares are, and will immediately prior to the Effective Time be, owned by the undersigned
free and clear of all mortgages, liens, charges, encumbrances, security interests and adverse claims; |
| (c) | the undersigned has not filed a notice exercising dissent rights; |
| (d) | the Deposited Shares have not been sold, assigned or transferred, nor has any agreement been entered into
to sell, assign or transfer any of the Deposited Shares to any person; |
| (e) | at the Effective Time, Coeur Canadian Sub will acquire good title to the Deposited Shares free from all
liens, charges, encumbrances, claims and equities; |
| (f) | the deposit of the Deposited Shares complies with applicable laws; |
| (g) | the undersigned has the full power and authority to execute and deliver this Letter of Transmittal and
to deposit, sell, assign, transfer and deliver the Deposited Shares to Coeur Canadian Sub, and when the Coeur Shares are delivered, SilverCrest,
Coeur Canadian Sub, Coeur or any affiliate thereof or successor thereto will not be subject to any adverse claim in respect of such Deposited
Shares; |
| (h) | all information inserted into this Letter of Transmittal by the undersigned is complete and accurate;
and |
| (i) | the delivery of the applicable number of Coeur Shares will discharge any and all obligations of SilverCrest,
Coeur Canadian Sub, Coeur and the Depositary with respect to the Deposited Shares. |
These representations and warranties shall
survive the completion of the Arrangement.
IN CONNECTION WITH THE ARRANGEMENT AND FOR
VALUE RECEIVED, at the Effective Time, all of the right, title and interest of the undersigned in and to the Deposited Shares and in and
to any and all dividends, distributions, payments, securities, rights, warrants, assets or other interests (collectively, “distributions”)
which may be declared, paid, accrued, issued, distributed, made or transferred on or in respect of the Deposited Shares or any of them
as and from the Effective Date, as well as the right of the undersigned to receive any and all distributions shall have been assigned
to Coeur Canadian Sub. If, notwithstanding such assignment, any distributions are received by or made payable to or to the order of the
undersigned, then the undersigned shall promptly pay or deliver the whole of any such distribution to the Depositary for the account of
Coeur, together with appropriate documentation of transfer. The undersigned further represents and warrants that the payment of the Consideration
in respect of the Deposited Shares will completely discharge any obligations of Coeur, Coeur Canadian Sub, SilverCrest and the Depositary
with respect to the matters contemplated in this Letter of Transmittal.
The undersigned irrevocably constitutes and
appoints any one officer or director of Coeur, or any other person designated by Coeur in writing, the true and lawful agent, attorney
and attorney-in-fact of the undersigned with respect
to the Deposited Shares purchased in connection
with the Arrangement with full power of substitution (such power of attorney, being coupled with an interest, being irrevocable) to, in
the name of and on behalf of the undersigned, (a) register or record the transfer of such Deposited Shares consisting of securities
on the registers of SilverCrest; and (b) execute and negotiate any cheques or other instruments representing any such distribution
payable to or to the order of the undersigned.
The undersigned revokes any and all other authority, whether as
agent, attorney-in-fact, attorney, proxy or otherwise, previously conferred or agreed to be conferred by the undersigned at any time with
respect to the Deposited Shares or any distributions other than as set out in this Letter of Transmittal and in any proxy granted for
use at the Meeting. Other than in connection with the Meeting, no subsequent authority, whether as agent, attorney-in-fact, attorney,
proxy or otherwise, will be granted with respect to the Deposited Shares or any distributions by or on behalf of the undersigned, unless
the Deposited Shares are not transferred to and acquired by Coeur Canadian Sub in connection with the Arrangement.
The undersigned covenants and agrees to execute
all such documents, transfers and other assurances deemed by the Depositary to be necessary or desirable to convey the Deposited Shares
and distributions effectively to Coeur Canadian Sub.
The undersigned agrees that all questions as
to validity, form, eligibility (including timely receipts) and acceptance of any Deposited Shares surrendered in connection with the Arrangement
will be determined by Coeur, in its sole discretion, and that such determination will be final and binding and acknowledges that there
is no duty or obligation upon SilverCrest, Coeur, Coeur Canadian Sub, the Depositary or any other person to give notice of any defect
or irregularity in any such surrender of Deposited Shares and no liability will be incurred by any of them for failure to give any such
notice.
Each authority conferred or agreed to be conferred
by the undersigned in this Letter of Transmittal shall survive the death, legal incapacity, bankruptcy or insolvency of the undersigned
and may be exercised during any subsequent legal incapacity of the undersigned and all obligations of the undersigned in this Letter of
Transmittal shall be binding upon the heirs, personal representatives, successors and assigns of the undersigned.
The undersigned acknowledges that Coeur, Coeur
Canadian Sub and/or SilverCrest may be required to disclose certain personal information in respect of the undersigned and consents to
disclosure of personal information in respect of the undersigned to stock exchanges (including the TSX, NYSE and/or NYSE American), securities
regulatory authorities, applicable tax authorities, the Depositary, any parties to the Arrangement (including their respective legal counsel)
and as otherwise required by any applicable law.
The undersigned authorizes and directs the
Depositary, upon the Arrangement becoming effective, to issue a DRS Advice representing the Coeur Shares to which the undersigned is entitled
to receive pursuant to the Arrangement in exchange for a duly completed Letter of Transmittal and the Deposited Shares, together with
such additional documents as the Depositary or Coeur may require and to and to mail such DRS Advice by first class mail, postage prepaid,
or to hold such advice for pick-up, in accordance with the instructions given below or, if no instructions are given, in the name and
to the address if any, of the undersigned as appears on the share register maintained by SilverCrest or its registrar and transfer agent.
In the event that a DRS Advice is not available, a Coeur share certificate will be delivered to the undersigned in the same manner as
a DRS Advice, as described above. Should the Arrangement not proceed for any reason, the deposited certificates and DRS Advices representing
SilverCrest Shares and other relevant documents shall be returned in accordance with the instructions in the preceding sentence.
The undersigned acknowledges and agrees that
SilverCrest, Coeur, the Depositary, their respective subsidiaries and any other person, as applicable will be entitled to deduct or withhold
from any Consideration otherwise payable, issuable or otherwise deliverable to any SilverCrest Shareholder under the Plan of Arrangement
such amounts as SilverCrest, Coeur, the Depositary their respective subsidiaries or any other person, as the case may be, is required
to deduct or withhold from such payment under any provision of the Income Tax Act (Canada), and the rules and regulations promulgated
thereunder, or any provision of any federal, provincial, territorial, state, local or foreign tax law as is required to be so deducted
or withheld by SilverCrest, Coeur or the Depositary their respective subsidiaries or any other person, as the case may be.
It is understood that the undersigned will
not receive Coeur Shares in respect of the Deposited Shares until after the Arrangement is consummated and until the Share Certificate(s)
or DRS Advice(s) representing SilverCrest Shares owned by the undersigned are received by the Depositary at the address below, together
with such additional documents as the Depositary or Coeur may require, and until the same are processed by the Depositary. If the Arrangement
is not completed for any reason, the enclosed Share Certificate(s) or DRS Advice(s) and all other ancillary documents will
be returned forthwith to the undersigned in
the name of and to the address specified by the undersigned in Box A of this Letter of Transmittal or, if such name or address is not
so specified, in such name and to such address as shown on the share register maintained by SilverCrest or its registrar and transfer
agent. The undersigned understands and acknowledges that under no circumstances will interest accrue or be paid in respect of the Deposited
Shares in connection with the Arrangement.
By reason of the use by the undersigned of
an English language form of Letter of Transmittal, the undersigned shall be deemed to have required that any contract evidenced by the
Arrangement as accepted through this Letter of Transmittal, as well as all documents related thereto, be drawn exclusively in the English
language. En raison de l’usage d’une lettre d’envoi en langue anglaise par le soussigné, le soussigné
et les destinataires sont présumés d’avoir requis que tout contrat attesté par l’arrangement et son
acceptation par cette lettre d’envoi, de même que tous les documents qui s’y rapportent, soient rédigés
exclusivement en langue anglaise.
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BOX A
DELIVERY INSTRUCTIONS
All Coeur Shares will be issued and mailed to your existing registration
unless otherwise stated. If you would like your shares dispatched to a different address, please complete BOX B
☐ MAIL
SHARES TO ADDRESS ON RECORD (DEFAULT)
☐ MAIL
SHARES TO A DIFFERENT ADDRESS (MUST
COMPLETE BOX B)
☐ HOLD
SHARES FOR PICKUP AT COMPUTERSHARE TORONTO OFFICE:
Computershare Investor Services Inc.
100 University Ave, 8th Floor,
Toronto ON |
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BOX B
DELIVERY TO 3rd PARTY ADDRESS*:
☐ CHECK
BOX IF SAME AS EXISTING REGISTRATION
(DEFAULT)
____________________________
(ATTENTION NAME)
____________________________
(STREET NUMBER & NAME)
____________________________
(CITY AND PROVINCE/STATE)
____________________________
(COUNTRY AND POSTAL/ZIP CODE)
____________________________
(TELEPHONE NUMBER (BUSINESS HOURS)
____________________________
(SOCIAL INSURANCE/SECURITY NUMBER)
* THE COEUR SHARES WILL REMAIN IN THE NAME OF THE REGISTRATION
OF THE SILVERCREST SHARES |
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BOX C
LOST CERTIFICATES
If your lost certificate(s) forms part of an
estate or trust, or are valued at more than CAD$200,000.00, please contact Computershare for additional instructions. Any person who,
knowingly and with intent to defraud any insurance company or other person, files a statement of claim containing any materially false
information or conceals for the purpose of misleading, information concerning any fact material thereto, commits a fraudulent insurance
act, which is a crime.
PREMIUM CALCULATION
_______X CAD$0.69 = Premium Payable $________________ NOTE:
Payment NOT required if premium is less than $5.00
The option to replace your certificate by completing this Box C
will expire on December 31, 2025. After this date, shareholders must contact Computershare for alternative replacement options. I enclose
my certified cheque, bank draft or money order payable to Computershare Investor Services Inc.
STATEMENT OF LOST CERTIFICATES
The undersigned (solitarily, jointly and severally,
if more than one) represents and agrees to the following: (i) the undersigned is (and, if applicable, the registered owner of the Original(s),
at the time of their death, was) the lawful and unconditional owner of the Original(s) and is entitled to the full and exclusive possession
thereof; (ii) the missing certificate(s) representing the Original(s) have been lost, stolen or destroyed, and have not been endorsed,
cashed, negotiated, transferred, assigned, pledged, hypothecated, encumbered in any way, or otherwise disposed of; (iii) a diligent search
for the certificate(s) has been made and they have not been found; and (iv) the undersigned makes this Statement for the purpose of transferring
or exchanging the Original(s) (including, if applicable, without probate or letters of administration or certification of estate trustee(s)
or similar documentation having been granted by any court), and hereby agrees to surrender the certificate(s) representing the Original(s)
for cancellation should the undersigned, at any time, find the certificate(s).
The undersigned hereby agrees, for myself and
my heirs, assigns and personal representatives, in consideration of the transfer or exchange of the Original(s), to completely indemnify,
protect and hold harmless SilverCrest Metals Inc., Coeur Mining, Inc., Computershare Investor Services Inc., Aviva Insurance Company of
Canada, each of their lawful successors and assigns, and any other party to the transaction (the “Obligees”), from
and against all losses, costs and damages, including court costs and attorneys’ fees that they may be subject to or liable for in
respect of the cancellation and/or replacement of the Original(s) and/or the certificate(s) representing the Original(s) and/ or the transfer
or exchange of the Originals represented thereby, upon the transfer, exchange or issue of the Originals and/or a cheque for any cash payment.
The rights accruing to the Obligees under the preceding sentence shall not be limited by the negligence, inadvertence, accident, oversight
or breach of any duty or obligations on the part of the Obligees or their respective officers, employees and agents or their failure to
inquire into, contest, or litigate any claim, whenever such negligence, inadvertence, accident, oversight, breach or failure may occur
or have occurred. I acknowledge that a fee of CAD$0.69 per lost SilverCrest Share is payable by the undersigned. Surety protection for
the Obligees is provided under Blanket Lost Original Instruments/Waiver of Probate or Administration Bond No. 35900-16 issued by Aviva
Insurance Company of Canada. |
SHAREHOLDER SIGNATURE(S)
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Signature guaranteed by
(if required under Instruction 3)
_________________________________
Authorized Signature
_________________________________
Name of Guarantor (please print or type)
_________________________________
Address of Guarantor (please print or type)
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Dated:________________________________, 202_
_________________________________ Signature of Shareholder or authorized representative
(see Instructions 2 and 4)
_________________________________
Address
_________________________________
Name of Shareholder (please print or type)
_________________________________
Telephone No
_________________________________
Email Address
_________________________________
Name of authorized representative, if applicable (please print or
type)
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INSTRUCTIONS
1. Use of Letter of Transmittal
Registered Shareholders of SilverCrest Shares
should read the accompanying Circular prior to completing this Letter of Transmittal. Capitalized terms used but not defined in this Letter
of Transmittal have the meanings set out in the Circular. In order for registered holders of SilverCrest Shares to receive the Consideration
for their SilverCrest Shares, such holders must deposit the Share Certificate(s) or DRS Advice(s), as applicable, representing their SilverCrest
Shares with the Depositary. This Letter of Transmittal, properly completed and duly executed, together with all other documents and instruments
referred to in this Letter of Transmittal or reasonably requested by the Depositary, must accompany all Share Certificate(s) or DRS Advice(s),
as applicable, representing SilverCrest Shares deposited for payment pursuant to the Arrangement.
Coeur reserves the right if Coeur so elects
in its absolute discretion to instruct the Depositary to waive any defect or irregularity contained in any Letter of Transmittal and/or
accompanying documents received by it.
The method used to deliver this Letter of Transmittal
and any accompanying Share Certificate(s) or DRS Advice(s) representing SilverCrest Shares is at the option and risk of the holder, and
delivery will be deemed effective only when such documents are actually received. Coeur recommends that the necessary documentation be
delivered through the use of registered mail with return receipt requested, properly insured, to the Depositary at its office(s) specified
on the last page of this Letter of Transmittal. A Shareholder whose SilverCrest Shares are registered in the name of a broker, investment
dealer, bank, trust company or other nominee should contact that nominee for assistance in depositing those SilverCrest Shares.
2. Signatures
This Letter of Transmittal must be filled in and signed by the holder
of SilverCrest Shares described above or by such holder’s duly authorized representative (in accordance with Instruction 4).
| (a) | If this Letter of Transmittal is signed by the registered owner(s) of the accompanying Share Certificate(s)
or DRS Advice(s), such signature(s) on this Letter of Transmittal must correspond with the names(s) as registered or as written on the
face of such Share Certificate(s) or DRS Advice(s) without any change whatsoever, and the certificate(s) need not be endorsed. If such
deposited Share Certificate(s) or DRS Advice(s) are owned of record by two or more joint owners, all such owners must sign the Letter
of Transmittal. |
| (b) | If this Letter of Transmittal is signed by a person other than the registered owner(s) of the accompanying
Share Certificate(s) or DRS Advice(s): |
| (i) | such deposited Share Certificate(s) or DRS Advice(s) must be endorsed or be accompanied by an appropriate
share transfer power of attorney duly and properly completed by the registered owner(s); and |
| (ii) | the signature(s) on such endorsement or share transfer power of attorney must correspond exactly to the
name(s) of the registered owner(s) as registered or as appearing on the Share Certificate(s) or DRS Advice(s) and must be guaranteed as
noted in Instruction 3 below. |
3. Guarantee of Signatures
If (i) this Letter of Transmittal is signed
by a person other than the registered owner(s) of the Deposited Shares, (ii) in the event the Arrangement is not completed, Deposited
Shares are to be returned to a person other than such registered holder(s) or sent to an address other than the address of the registered
holder(s) as shown on the share register of SilverCrest as maintained by the Transfer Agent, or (iii) if the Consideration is to be issued
or delivered in the name of a person other than the registered owner of the Deposited Shares, such signature must be guaranteed by an
Eligible Institution (as defined below), or in some other manner satisfactory to the Depositary (except that no guarantee is required
if the signature is that of an Eligible Institution).
An “Eligible Institution” means
a Canadian Schedule I chartered bank, a major trust company in Canada, a commercial bank or trust company in the United States, a member
of the Securities Transfer Association Medallion Program (STAMP), a member of the Stock Exchange Medallion Program (SEMP) or a member
of the New York Stock Exchange Inc. Medallion Signature Program (MSP). Members of these programs are usually members of a recognized
stock exchange in Canada and the United States,
members of the Investment Industry Regulatory Organization of Canada, members of the Financial Industry Regulatory Authority or banks
and trust companies in the United States.
4. Signed by a Representative
If this Letter of Transmittal is signed by
a person in a representative capacity, such as (a) an executor, administrator, trustee or guardian, or (b) on behalf of a corporation,
partnership, or association, then in each case such signature must be guaranteed by an Eligible Institution, or in some other manner satisfactory
to the Depositary (except that no guarantee is required if the signature is that of an Eligible Institution). Either Coeur or the Depositary,
at its discretion, may require additional evidence of authority or additional documentation.
5. Miscellaneous
| (a) | If the space on this Letter of Transmittal is insufficient to list all Share Certificate(s) or DRS Advice(s)
for Deposited Shares, additional certificate numbers or DRS Advice(s) and number of Deposited Shares may be included on a separate signed
list affixed to this Letter of Transmittal. |
| (b) | If Deposited Shares are registered in different forms (e.g., “John Doe” and “J. Doe”)
a separate Letter of Transmittal should be signed for each different registration. |
| (c) | No alternative, conditional or contingent deposits will be accepted. |
| (d) | The Arrangement and any agreement in connection with the Arrangement will be construed in accordance with
and governed by the laws of the Province of British Columbia and the laws of Canada applicable therein. |
| (e) | Additional copies of the Circular and this Letter of Transmittal may be obtained from the Depositary at
any of its respective offices at the addresses listed below. |
6. Lost Certificates
Option #1: If a Share Certificate has
been lost, stolen or destroyed, this Letter of Transmittal should be completed as fully as possible and forwarded together with a letter
describing the loss to the Depositary. The Depositary will respond with the replacement requirements.
Option #2: Alternatively, Shareholders
who have lost, stolen, or destroyed their certificate(s) may participate in Computershare’s blanket bond program with Aviva Insurance
Company of Canada by completing BOX C above, and submitting the applicable certified cheque or money order made payable to Computershare
Investor Services Inc.
7. Privacy Consent
Computershare will use the information you
are providing in order to process your request and will treat your signature(s) as your consent to us so doing.
8. Privacy Notice
Computershare is committed to protecting your
personal information. In the course of providing services to you and our corporate clients, we receive non-public personal information
about you from transactions we perform for you, forms you send us, other communications we have with you or your representatives, etc.
This information could include your name, contact details (such as residential address, correspondence address, email address), social
insurance number, survey responses, securities holdings and other financial information. We use this to administer your account, to better
serve your and our clients’ needs and for other lawful purposes relating to our services. Computershare may transfer personal information
to other companies located outside of your province within Canada, or outside of Canada that provide data processing and storage or other
support in order to facilitate the services it provides. Where we share your personal information with other companies to provide services
to you, we ensure they have adequate safeguards to protect your personal information as per applicable privacy laws. We also ensure the
protection of rights of data subjects under the General Data Protection Regulation, where applicable. We have prepared a Privacy Code
to tell you more about our information practices, how your privacy is protected and how to contact our Chief Privacy Officer. It is available
at our website, www.computershare.com, or by writing to us at 100 University Avenue, Toronto, Ontario, M5J 2Y1.
THIS PAGE INTENTIONALLY LEFT BLANK
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The Depositary is:
COMPUTERSHARE INVESTOR SERVICES INC.
By Hand or by Courier
100 University Avenue, 8th Floor, North Tower
Toronto, Ontario
M5J 2Y1
By Mail
P.O. Box 7021
31 Adelaide St E
Toronto, ON M5C 3H2 Attention: Corporate Actions
For Enquiries Only
Toll Free: 1-800-564-6253
E-Mail: corporateactions@computershare.com
EXHIBIT
99.5
CERTIFICATE
| TO: | Alberta Securities Commission
British Columbia Securities Commission
Manitoba Securities Commission
New Brunswick Financial and Consumer
Services Commission
Office of the Superintendent of
Securities Service Newfoundland and Labrador
Nova Scotia Securities Commission
Ontario Securities Commission
Prince Edward Island Financial
and Consumer Services Division
Financial and Consumer Affairs
Authority of Saskatchewan
|
| | |
| RE: | Special meeting of securityholders to be held on February 6, 2025 (the “Meeting”) |
Reference is made to National Instrument 54-101
– Communication with Beneficial Owners of Securities of a Reporting Issuer (“NI 54-101”) Part 2, section
2.20, pursuant to which a reporting issuer may abridge the time prescribed in subsections 2.1(b), 2.2(1) or 2.5(1) of NI 54-101 for the
establishment of meeting and record dates to a lesser period.
I, N. Eric Fier, Chief Executive Officer of
SilverCrest Metals Inc. (the “Company”), hereby certify on behalf of the Company and not in my personal capacity, as
follows:
| (a) | the Company is relying on section 2.20 of NI 54-101 to abridge the time prescribed in subsections 2.2(1)
and 2.5(1) of NI 54-101; and |
| (b) | in reliance on Section 2.20 of NI 54-101, the Company has: |
| (i) | made arrangements to have the proxy-related materials relating to the Meeting sent in compliance with
section 2.9 and 2.12 of NI 54-101 to all registered shareholders of the Company as of December 19, 2024; and |
| (ii) | made arrangements to carry out all of the requirements of NI 54-101 in addition to those described in
the preceding subparagraph (i). |
DATED January 13, 2025.
| |
SILVERCREST METALS INC. |
|
| |
|
|
|
|
| |
By: |
(Signed) “N. Eric Fier” |
|
| |
|
Name: |
N. Eric Fier |
|
| |
|
Title: |
Chief Executive Officer |
|
SilverCrest Metals (AMEX:SILV)
Graphique Historique de l'Action
De Déc 2024 à Jan 2025
SilverCrest Metals (AMEX:SILV)
Graphique Historique de l'Action
De Jan 2024 à Jan 2025
