RIO Silver Announces Closing of Private Placement

RIO SILVER ANNOUNCES CLOSING OF PRIVATE PLACEMENT

January 19, 2017, Toronto, Ontario, Canada – Rio Silv er Inc. (“Rio Silver” or the "Company") (TSX.V:

RYO) is pleased to announce that, further to its previous news release on January 13, 2017, the Company has

received regulatory approval to close the second of two financings contemplated in its transaction

(“Transaction”) with Magellan Gold Corporation (“ Magellan”) (OTCQB – MAGE). The second financing

was a non-brokered private placement (the " Offering") consisting of 1,250,000 units (" Units") of the

Company at $0.06 per Unit for gross proceeds of $75,00 0. Each Unit consists of one common share of the

Company and one common share purchase warrant (each a “ Warrant”) entitling the holder to acquire one

common share of the Company at a price of $0.06 per share until July 19, 2018. All securities in the Offering

were acquired by Magellan. The securities issued will be subject to a four-month statutory hold period until

May 20, 2017. No finder’s fees were paid in connec tion with the Offering. The proceeds from the Offering

will be used for working capital and general and administrative purposes.

Prior to giving effect to the recent acquisition, Magellan held ownership and control over 1,500,000 common

shares of the Company, representing 5.11% of the i ssued and outstanding shares of the Company, and

1,500,000 warrants (which would repr esent 9.80% of the then issued and outstanding common shares of the

Company assuming exercise of the 1,500,000 warrants). After giving effect to the shares and warrants

acquired in the Offering, Magellan holds 2,750,000 common shares, representing 8.99% of the issued and

outstanding shares of the Company. Assuming exer cise of the 2,750,000 warrants now held, Magellan

would hold 5,500,000 common shares of the Company, representing 16.49% of the issued and outstanding

shares of the Company.

The shares and warrants were acquired for investment pur poses. In the future, Magellan or its affiliates may

acquire additional securities of the Company or dispose of such securities through the market or otherwise

subject to a number of factors, including general ma rket and economic conditions, other investment and

business opportunities available and other circumstances.

This news release is being issued in accordance with National Instrument 62-103 – The Early Warning

System and Related Take-Over Bid and Insider Reporting Issues in connection with the filing of an early

warning report dated January 19, 2017. The early warning report respecting the transaction has been filed on

the System for Electronic Document Analysis and Review (“SEDAR”) under the Company’s profile at

www.sedar.com or may be obtained by contacting Dan Hamilton at (416-479-9546).

The Purchaser’s office is at 2010A Harbison Drive #312, Vacaville, California, USA, 95687.

ON BEHALF OF THE BOARD OF DIRECTORS OF RIO SILVER INC.

Jeffrey Reeder

President and Chief Executive Officer

Neither the TSX Venture Exchange nor its Regulation Services Provider accepts responsibility for the

adequacy or accuracy of this release.

This news release includes forward-looking statements that are subject to risks and uncertainties. All statements within,

other than statements of historical fact, are to be co nsidered forward looking. Although the Company believes the

expectations expressed in such forward-looking statements are based on reasonable assumptions, such statements are

not guarantees of future performance and actual results or developments may d iffer materially from those in forward-

looking statements. Factors that could cause actual results to differ materially from those in forward-looking statements

include market prices, exploitation and exploration successes, continued availability of capital and financing, and

general economic, market or business conditions. There can be no assurances that such statements will prove accurate

and, therefore, readers are advised to rely on their ow n evaluation of such uncertainties. We do not assume any

obligation to update any forward-looking statements except as required by applicable laws.

For more information contact:

Jeff Reeder, President, CEO Dan Hamilton, Chief Financial Officer

Tel: (647) 302-3290 Tel: (416) 479-9546

Website: www.riosilverinc.com