Premier closes purchase of Mercedes Mine, funded by Orion Mine Finance

On September 30, 2016, Premier Gold Mines Limited ("Premier") completed its acquisition of Yamana Gold Inc.'s ("Yamana") 100% interest in the Mercedes Mine Property, located some 60 km southeast of Magdalena de Kino, in the Sonora State, Mexico, for a total consideration of US$122.5 million in cash plus shares, equity securities and net smelter return royalties.

The cash purchase price was funded pursuant to a financing package provided by Orion Mine Finance ("Orion"), which comprised of

• a US$42,187,500 senior secured gold prepay credit facility;
• a US$11,500,000 senior secured silver stream;
• an increase in Premier's existing unsecured credit facility with Orion of US$15 million to US$45 million;
• a private placement of 10,958,333 common shares of Premier for a gross purchase price of US$35,000,000;
• 1,000,000 warrants to acquire up to 1,000,000 common shares, entitling Orion to purchase one common share upon the exercise thereof at the price of US$5.46 per share until June 30, 2018; and
• an amendment to Premier's existing offtake obligations with Orion to sell up to an additional 20,000 ounces of gold annually relating exclusively to production from the Mercedes Mine.

Yamana is a Canadian-based gold producer with significant gold production, gold development stage properties, exploration properties, and land positions throughout the Americas including Brazil, Argentina, Chile, and Canada.

Premier is a gold-focused production, exploration and development company with assets located in Canada, the United States and Mexico.

Orion is a mining-focused investment business specializing in providing flexible capital investment solutions to mining companies in the base and precious metals sector.

Further information can be found on Canada Newswire's website.