Acquisition of the Jefferson County Metallurgical Complex in Jefferson County, Montana, comprising separate 15,000-tpd and 1,000-tpd milling and flotation circuits, together with extensive associated infrastructure on approximately 5,000 acres.

Strategically located near Silver Bow Mining’s Rainbow Block Project and expected to be suitable for processing the high-grade silver-gold-zinc-lead mineralization comprising the Rainbow Block resource.

Provides the Company with processing infrastructure and additional flexibility as it evaluates potential development pathways for the Rainbow Block.

Approximately US$28.6 million in cash to satisfy creditors, including full cash payments of approximately $4.27 million to Jefferson County and approximately $20.8 million to the Montana DEQ, and equity consideration in the form of contingent value rights potentially convertible into common shares of Silver Bow Mining upon satisfaction of future milestones.

Webcast to be held today, August 24, 2026, at 4:00 p.m. ET to discuss the acquisition.

Silver Bow Mining Corp. (NYSE:SBMT) ("Silver Bow Mining" or the "Company") is pleased to announce that it has entered into a definitive asset purchase agreement (the "Agreement") with Montana Goldfields, Inc. ("MTGF") and Montana Tunnels Mining, Inc. to acquire an integrated metallurgical complex containing two distinct mineral processing circuits, together with the historic Montana Tunnels M-Pit (collectively, the "Jefferson County Metallurgical Complex" or the "Complex"), located in Jefferson County, Montana.

Transaction Structure and Consideration

Under the terms of the Agreement, Silver Bow Mining will acquire 100% ownership of the Complex at Final Closing, free and clear of liens. The Agreement provides a staged transaction structure, including an Initial Closing and a subsequent Final Closing following satisfaction or waiver of the applicable closing conditions.

  • Initial Closing funding obligation. The Company will fund approximately US$28.6 million to satisfy specified creditors associated with the acquired assets, including approximately US$4.27 million to satisfy amounts owing to Jefferson County and approximately US$20.8 million to satisfy specified obligations owing to the Montana Department of Environmental Quality ("Montana DEQ"). In consideration for the funding, at the Initial Closing Montana Tunnels Mining, Inc. will issue to the Company a senior secured note secured against the real property interests, fixtures and tangible personal property at the Jefferson County Metallurgical Complex.
  • Final Closing consideration. Following receipt of necessary approvals, at Final Closing, Silver Bow Mining will issue 3,500,000 contingent value rights ("Final Closing CVRs"); each Final Closing CVR convert into one common share of Silver Bow Mining 180 days following Final Closing, subject to certain terms and limitations as set forth in the Final Closing CVR terms. The issuance of the Final Closing CVRs, the Deferred Compensation CVRs (as defined below) and the underlying shares of Silver Bow Mining are subject to the approval of the shareholders of Silver Bow Mining, the approval of the NYSE American and other required approvals.
  • Deferred M-Pit milestone consideration. The Agreement also provides for the issuance to MTGF of 11,500,000 additional deferred compensation CVRs, representing potential future consideration contingent on future contingent milestones (the "Deferred Compensation CVRs"), including potential M-Pit exploration, development and commercial production. Of these, 6,250,000 Deferred Compensation CVRs will convert into 6,250,000 common shares of Silver Bow Mining upon the earlier of (i) a positive construction decision on the M-Pit Expansion or (ii) nine months following completion of an M-Pit feasibility study which demonstrates positive economics for the project. The remaining 5,250,000 Deferred Compensation CVRs will convert upon the earlier of (i) the achievement of the M-Pit commercial production milestone or (ii) 36 months following a construction decision by Silver Bow Mining on the M-Pit Expansion, subject to specified extensions.
  • CVR restrictions. All CVRs will be subject to certain eligibility and transfer restrictions under the CVR Agreement, including restrictions intended to prevent persons who are ineligible under Montana Code Annotated §82-4-360 from converting CVRs into Silver Bow Mining common shares. Section 82-4-360 limits the ability of certain persons to engage in hard-rock mining or exploration activities in Montana.
  • Other contingent economic interests. The transaction includes certain contingent economic interests in favor of MTGF that are dependent upon future activity, production, or net profits from the acquired assets. These include: (i) a 2% net smelter return royalty on future production from the M-Pit, subject to a US$10 million full buyback right in favor of Silver Bow Mining; (ii) a toll-milling arrangement for material from MTGF’s Golden Dream and Diamond Hill projects, subject to satisfaction of all applicable State of Montana permitting and eligibility requirements; (iii) a 50% net profits interest ("NPI") related to potential future tailings reprocessing at the Complex; and (iv) a 75% NPI in potential future Clancy Creek placer production at the Complex. These NPI arrangements apply only to the specified future activities and become relevant solely if those activities are permitted under applicable State of Montana requirements, are determined to be economically viable, are undertaken, and generate net profits after recoupment of capital investment.

Post-Closing Work Commitments

Following Final Closing, the Company has agreed to undertake specified technical work programs associated with the acquired Complex. These include a US$5 million work program directed toward completion of a Feasibility Study on the M-Pit Expansion, and a US$3 million program to advance detailed engineering and regulatory work associated with the Clancy Creek Bypass Channel.

The Agreement provides for completion of the M-Pit Feasibility Study within nine months following Final Closing, subject to specified extensions for certain technical matters that may require additional assessment or verification. The feasibility work will evaluate technical and economic considerations associated with the M-Pit Expansion.