Liquidity and Capital Resources	6 Months Ended
Jun. 30, 2013
Liquidity and Capital Resources
Liquidity and Capital Resources	2. Liquidity and Capital Resources At June 30, 2013 the Company’s cash balance was $30.0 million and, based on the assumptions described below, we expect to have a cash balance of approximately $16.0 million at December 31, 2013. During the first quarter of 2013 the Company completed the sale of certain Peruvian exploration properties to a third party for net proceeds of $3.5 million. The Company received other proceeds of $0.5 million related to joint venture option payments on other Mexican and Peruvian exploration properties. With the cash balance at June 30, 2013 the Company expects to have sufficient funding to continue its long-term business strategy through 2013. On June 19, 2013 the Company suspended operations at its Velardeña Operations in order to conserve the asset until the Company is able to develop operating plans, which at then current prices for silver and gold indicate a sustainable cash margin for operations. (See Note 1). The Company accrued approximately $2.3 million of severance and other costs related to the suspension in the second quarter of 2013 and expects to incur costs of approximately $3.0 million for additional one-time suspension related activities and $2.5 million for care and maintenance during the remainder of the year should operations remain suspended. With the cash balance at June 30, 2013 of $30.0 million the Company plans to spend the following additional amounts during the remainder of 2013 pursuant to its long-term business strategy. These amounts do not include costs related to a potential restart of the Velardena Operations. · Approximately $3.0 million on one-time suspension costs, including labor and contractor costs associated with idling the plant and mobile mining equipment, costs for restocking of material and supplies, and other shutdown activities; · $2.5 million on care and maintenance costs at the Velardeña Operations; · Approximately $1.0 million at the El Quevar project to fund ongoing maintenance activities, property holding costs, and continuing project evaluation costs; · Approximately $2.5 million on other exploration activities and property holding costs related to the Company’s portfolio of exploration properties located primarily in Mexico, as the Company continues strategies to monetize portions of the portfolio; and · Approximately $3.0 million on general and administrative costs and $2.0 million on an increase in net working capital primarily related to the payment of accrued severance costs. The actual amount that the Company spends through year-end 2013 and the projected year-end cash balance may vary significantly from the amounts specified above and will depend on a number of factors, including the timing and costs associated with a potential restart of the Velardeña Operations, the results of continued project assessment work at El Quevar and other exploration properties, and whether the Company is able to monetize additional portions of its exploration portfolio.

2. Liquidity and Capital Resources

At June 30, 2013 the Company’s cash balance was $30.0 million and, based on the assumptions described below, we expect to have a cash balance of approximately $16.0 million at December 31, 2013. During the first quarter of 2013 the Company completed the sale of certain Peruvian exploration properties to a third party for net proceeds of $3.5 million. The Company received other proceeds of $0.5 million related to joint venture option payments on other Mexican and Peruvian exploration properties. With the cash balance at June 30, 2013 the Company expects to have sufficient funding to continue its long-term business strategy through 2013.

On June 19, 2013 the Company suspended operations at its Velardeña Operations in order to conserve the asset until the Company is able to develop operating plans, which at then current prices for silver and gold indicate a sustainable cash margin for operations. (See Note 1). The Company accrued approximately $2.3 million of severance and other costs related to the suspension in the second quarter of 2013 and expects to incur costs of approximately $3.0 million for additional one-time suspension related activities and $2.5 million for care and maintenance during the remainder of the year should operations remain suspended.

With the cash balance at June 30, 2013 of $30.0 million the Company plans to spend the following additional amounts during the remainder of 2013 pursuant to its long-term business strategy. These amounts do not include costs related to a potential restart of the Velardena Operations.

· Approximately $3.0 million on one-time suspension costs, including labor and contractor costs associated with idling the plant and mobile mining equipment, costs for restocking of material and supplies, and other shutdown activities;

· $2.5 million on care and maintenance costs at the Velardeña Operations;

· Approximately $1.0 million at the El Quevar project to fund ongoing maintenance activities, property holding costs, and continuing project evaluation costs;

· Approximately $2.5 million on other exploration activities and property holding costs related to the Company’s portfolio of exploration properties located primarily in Mexico, as the Company continues strategies to monetize portions of the portfolio; and

· Approximately $3.0 million on general and administrative costs and $2.0 million on an increase in net working capital primarily related to the payment of accrued severance costs.

The actual amount that the Company spends through year-end 2013 and the projected year-end cash balance may vary significantly from the amounts specified above and will depend on a number of factors, including the timing and costs associated with a potential restart of the Velardeña Operations, the results of continued project assessment work at El Quevar and other exploration properties, and whether the Company is able to monetize additional portions of its exploration portfolio.