Aftermath Amends Chilean Silver-Gold Projects Acquisition Agreements
FOR IMMEDIATE RELEASE January 15, 2019
(AAG2019 – NR #1)
Aftermath Amends Chilean Silver-Gold Projects Acquisition
Agreements
Vancouver, BC – January 15, 2019 - Aftermath Silver Ltd. (AAG.H – NEX) (“Aftermath” or
the “Company”) is pleased to announce it has reached agreements in principle to amend the terms
of two existing agreements relating to the Company’s acquisitions of two significant silver-gold
projects in Chile.
Challacollo Silver-Gold Project
As announced by news release dated August 1, 2018, the Company has entered into a non-binding
Letter of Intent (the “Challacollo LOI”) with Mandalay Resources Inc. (“Mandalay”) to purchase
the Challacollo silver-gold project (“Challacollo”) by the purchase of 100% of Mandalay’s shares
in the Chilean holding company Minera Mandalay Challacollo Limitada (“MMC”), which
currently owns 100% of the Project. Challacollo is the only asset held by MMC.
Under the terms of the Challacollo LOI, as amended, the Comp any may acquire MMC for an
aggregate of:
• CA$1,000,000 cash to be paid on or before February 28, 2019;
• CA$1,000,000 cash to be paid on or before September 30, 2020;
• CA$5,500,000 on or before February 28, 2021, to be paid, at Mandalay’s option, in
Aftermath shares of up to a value of CA$2,750,000, and the balance in cash; provided that
in no event shall the number of Aftermath shares issued represent more than 49% of
Aftermath’s outstanding shares following such payment; and
• Mandalay to retain a 3% Net Smelter Returns royalty on production, up to a maximum of
CA$3,000,000.
The Company, by making an additional CA$500,000 payment, shall have the right to vary the
February 28, 2021 payment by paying CA$3,000,000 on or before February 28, 2021 and an
additional CA$3,000,000 payment on or before February 28, 2022. In each case, Aftermath will
have the option to pay up to 50% of each payment in Aftermath shares, subject to Mandalay
holding no more than 49% of Aftermath’s outstanding shares following each such payment.
Challacollo is a low sulphidation epithermal deposit which hosts historic Mineral Resources1
including Indicated Resources of 4.7 million tonnes at 200 g/t silver and Inferred Resources
of 1.6 million tonnes at 134 g/t silver, with associated gold credits.
Drilling has defined the historic mineral resources on the principal vein (Lolón Vein) to a depth of
about 200 m below surface. The Company will focus its initial exploration efforts on parallel vein
systems, not included in the historic mineral resource, that have some preliminary drilling. The
oxidation level bottoms at approximately 200 m below surface; however, the down -dip extent of
the mineralized structures remains unkn own. Gold and base metal grades are generally observed
to increase with depth.
The Challacollo project is located in Chile’s Tarapaca Region (Region I), 130 km southeast of the
major port city of Iquique and 50 km south of the town of Pica. The project is approximately 30
km east of the Pan American Highway, via Teck Resources’ Quebrada Blanca Copper Mine access
road. The project is 139 km southeast of the major Pacific port city of Iquique.
Road and Power transmission lines are located 15 -30 km from the property, in part to service
nearby mines of Collahuasi and Quebrada Blanca. The Project includes water rights.
Cachinal Silver-Gold Project
As announced by news release dated June 25, 2018, the Company has entered into a definitive
agreement (the “Cachinal Agreement”) with Halo Labs Inc (Formally Apogee Opportunities Inc).
(“Apogee”) to purchase Apogee’s holding in the Cachinal De La Sierra Silver -Gold Project
(“Cachinal”) through the purchase of Apogee’s s hares in the Chilean holding company Minera
Cachinal S.A., representing 80% ownership.
The Cachinal Agreement provides for the Company to pay Halo $1,500,000 in cash on closing.
Under the amended agreement, the Company will now pay:
• CA$500,000 in cash on closing, to occur no later than February 28, 2019;
• CA$500,000 in cash to be paid on or before 12 months following closing; and
• CA$500,000 in cash to be paid on or before 18 months following closing.
• Halo will have the right to convert any part of the purc hase price that remains unpaid at
any time into shares of the Company at a price of $0.20 per share.
Cachinal, is a low sulphidation epithermal deposit which currently hosts current Mineral
Resources2 including Indicated Resources of 5.7 million tonnes at 101 g/t silver and Inferred
Resources of 0.8 million tonnes at 115 g/t silver, with associated gold credits.
Shallow drilling has defined the current mineral resources principally to a depth of 150 m below
surface and provides sufficient evidence to interpret the presence of high -grade shoots within the
vein system extending below the potential base of an open pit. Following these high-grade shoots
to depth with drilling will be the initial focus of the Company’s efforts to expand the silver -gold
mineralisation. The oxidation level bottoms at about 120 - 150 m below surface; however, the
down-dip extent of the mineralized structures remains unknown.
The Cachinal Silver -Gold Project is located in Chile’ s Antofagasta Region (Region II), 175 km
southeast of Antofagasta. The project is located about 40 km east of the Pan American Highway,
in a nearly flat plain at an elevation of around 2,700 m above sea level, 16 km north of Austral
Gold’s Guanaco gold-silver mine. The project includes 16 claim blocks for a total area of 4,867
hectares, in two non -contiguous areas. The Mineral Resource is located centrally within the
northern of the two claim groups.
Mr. Sean Hurd, President and CEO of the Company, commente d “The acquisitions of the high
grade Challacollo and Cachinal silver-gold projects will launch Aftermath into the upper ranks of
silver dominant explorer/developers, with current and historic pro-forma total of 48.6 million
tonnes Indicated Mineral Resources at 146 g/t and 9.9 million tonnes Inferred Mineral
Resource at 128 g/t. The new deal structures allow us to focus on advancing resource development
on both projects in the current market.”
The two agreements, as amended, are subject to the satisfaction of customary closing conditions,
including receipt of all regulatory approvals and any applicable shareholder approvals.
Qualified Person
Peter Voulgaris, MAIG, MAusIMM, a consultant to the Company, is a non-independent qualified
person as defined by NI 43 -101. Mr. Voulgaris has reviewed the technical content of this news
release, and consents to the information provided in the form and context in which it appears.
About Aftermath Silver Ltd
Aftermath Silver Ltd is a Canadian junior exploration company engaged in acquiring, exploring,
and developing mineral properties with an emphasis on silver in Chile. The Company is focused
of growth through the discovery and acquisition of quality projects in stable jurisdictions.
Aftermath continues to seek new opportunities to take advantage of the relatively low silver price.
ON BEHALF OF THE BOARD OF DIRECTORS
“Sean Hurd”
Sean Hurd, President & CEO
604-484-7855
Notes on Mineral Resources
1. Challacollo Historic Mineral Resourc e: An independent “Qualified Person”, as defined in
National Instrument 43-101 (“NI 43-101”), has not done sufficient work on behalf of Aftermath
to classify the historical estimate as a current indicated or inferred mineral resourc e, and
Aftermath is not treating the historical estimate as a current mineral resource.
For full details please see the March 2015 43-101 Technical Report “NI 43-101 Technical Report
for the Challacollo Silver Project, Region 1, Chile ” QPs Mroczek, M., Col lins, and M., Butler,
S. of Mining Plus Canada Consulting Ltd. and Tapia, J.C., of Sedgeman S.A. Prepared for
Mandalay Resources, available on the Mandalay Resources SEDAR profile.
• Challacollo mineral resources were classified according to the CIM Definition Standards
for Mineral Resources and Mineral Reserves (December 2005).
• Mineral Resources are estimated at a cut-off grade of 60 g/t Ag.
• Mineral Resources are estimated using a silver price of US$24/oz, a gold price of
US$1,400 per ounce, metallurgical re coveries of 92% for silver and 75% for gold, and
operating costs of US$50 per tonne.
• A density of 2.45 g/cm3 is used as a base density with adjustments according to the
variation of the estimated barium, lead and zinc grades.
• No capping of Ag grades has be en applied due to low grade variability. Au grades have
been capped at 3 g/t for two sample composites 4.57 g/t Au and 4.11 g/t Au respectively.
2. Cachinal current Mineral Resource Estimate: for full details please see the April 2018 43-101
Technical Report “Independent Technical Report for the Cachinal Silver -Gold Project, Region
II, Chile.” QPs Cole, G and Couture, J. of SRK Consulting (Canada) Inc. prepared for Aftermath
Silver filed on the Aftermath Silver SEDAR profile.
• Cachinal mineral resources were classified according to the CIM Definition Standards for
Mineral Resources and Mineral Reserves (December 2005).
• The Silver equivalent (AgEq) grades are calculated using gold to silver ratio of 50:1, using
metal price assumptions of US$12.50 per ounce of silver, US$650 per ounce of gold and
metallurgical recoveries of eighty-five percent for silver and gold. Zinc does not contribute
to revenues.
• Open Pit shell constrained Mineral Resources are reported at a cut-off of 40 g/t AgEq to a
vertical depth of 150 m below surface, constrained within a Lerchs Grosman optimised pit
shell.
• Underground constrained Mineral Resources are reported at a cut-off of 150 g/t AgEq.
The TSX Venture Exchange does not accept responsibility for the adequacy or accuracy of this release.
Forward Looking Statements
Certain statements within this news release, other than statements of historical fact relating to
Aftermath Silver, are to be considered forward -looking statements with respect to the Company’s
intentions for the Cachinal Project in Chile. Forward-looking statements include statements that are
predictive in nature, are reliant on future events or conditions, or include words such as “expects”,
“goal”, “potential”, “anticipates”, “plans”, “believes”, “cons iders”, “significant”, “intends”,
“targets”, “estimates”, “seeks”, attempts”, “assumes”, and other similar expressions.
The forward -looking statements are based on a number of assumptions which, while considered
reasonable by Aftermath Silver Ltd, are, by their nature, subject to inherent risks and uncertainties
and are not guarantees of future performance. Factors that could cause actual results to differ
materially from those in forward -looking statements include: the interpretation of previous and
current results, the accuracy of exploration results, the accuracy of Mineral Resource Estimates, the
anticipated results of future exploration, the forgoing ability to finance these acquisitions further
exploration and development, delays in the completion of exploration, the future prices of silver and
gold, and other metals, and general economic, market and/or business conditions. There can be no
assurances that such statements and assumptions will prove accurate and, therefore, readers of this
news release ar e advised to rely on their own evaluation of the information contained within. In
addition to the assumptions herein, these assumptions include the assumptions described in Aftermath
Silver Ltd’s Management’s Discussion and Analysis for the three months ended August 31, 2018, as
filed with the TSX Venture Exchange and available on SEDAR under Aftermath ’s profile at
www.sedar.com.
Although Aftermath Silver Ltd. has attempted to identify important risks, uncertainties and other
factors that could cause actual performance, achievements, actions, events, results or conditions to
differ materially from those expressed in or implied by the forward-looking statements, there may be
other risks, uncertainties and other factors that cause future performance to differ from what is
anticipated, estimated or intended. Unless otherwise indicated, forward-looking statements contained
herein are as of the date hereof and Aftermath Silver Ltd. does not assume any obligation to update
any forward-looking statements after the date on which such statements were made, except as required
by applicable law.