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Sabina Closes $75.5-Million First Tranche Of Financing

Sabina Gold & Silver Corp. has closed the first tranche of the $95-million (U.S.) equity private placement to Orion Mine Finance and Wheaton Precious Metals Corp. in connection with the previously announced project financing package to finance construction and development of the Goose mine at Sabina's 100-per-cent-owned Back River project in Nunavut, Canada.

The first tranche of the private placement, in connection with the $520-million (U.S.) financing package, comprises the issuance of 46,209,769 common shares of the company to Orion and 12,322,605 common shares of the company to Wheaton, for total net proceeds of approximately $75.5-million (Canadian).

"We are very happy with WPM's increased position and Orion's addition to Sabina's shareholder registry," said Bruce McLeod, president and chief executive officer. "We believe their investment in the company reflects their confidence in the merits of Goose mine, and in Sabina's ability to execute and deliver the Project. We look forward to continuing to report on our progress as we begin to kick off our 2022 activities."

In connection with the financing, as previously announced, Sabina executed final documentation with respect to: (i) the provision by Orion of a senior secured project finance debt facility in the principal amount of $225-million (U.S.) and a gold prepay facility in the amount of $75-million (U.S.), (ii) the purchase by Orion of 100 per cent of the annual refined gold production from the project based on prevailing market prices, (iii) the purchase by Orion, on a private placement basis, of up to $75-million (U.S.) of Sabina common shares, (iv) a $125-million (U.S.) gold stream arrangement with Wheaton and the purchase by Wheaton on a private placement basis of up to $20-million (U.S.) of Sabina common shares.

Equity financings

Orion and Wheaton have subscribed to a total private placement of 72,732,692 and 19,395,384 common shares of Sabina, respectively, at a price of $1.30. This private placement is scheduled to close in three tranches, with this being the initial, the second by the end of Q1 2022 and the third in Q2 2022. The proceeds of the financing will be used to finance 2022 development initiatives and procurement commitments, and includes repaying the previously announced $20-million (U.S.) Sprott bridge loan in accordance with its terms.

About Sabina Gold & Silver Corp.

Sabina Gold & Silver is an emerging gold mining that 100-per-cent owns the district-scale, advanced, high-grade Back River gold district in Nunavut, Canada.

Sabina recently filed an updated feasibility study (UFS) on its first mine on the district, the Goose mine, which presents a project that will produce approximately 223,000 ounces of gold a year (first five years average of 287,000 ounces a year with peak production of 312,000 ounces in year three) for approximately 15 years with a rapid payback of 2.3 years, with a posttax internal rate of return of approximately 28 per cent and net present value at a 5-per-cent discount of $1.1-billion.

The project received its final major authorization on June 25, 2020, and is now in receipt of all major permits and authorizations for construction and operations.

The company is also very committed to its Inuit stakeholders, with Inuit employment and opportunities a focus. The company has signed a 20-year renewable land use agreement with the Kitikmeot Inuit Association and has committed to various sustainability initiatives under the agreement.

In addition to Back River, Sabina also owns a significant silver royalty on Glencore's Hackett River Project. The silver royalty on Hackett River's silver production comprises 22.5 per cent of the first 190 million ounces produced and 12.5 per cent of all silver produced thereafter.

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