Mithril enters option deal to acquire La Dura property

Executive Summary

• Mithril Silver and Gold Ltd. has executed a purchase option agreement to acquire a 100% interest in the La Dura gold-silver property, located in Durango state, Mexico, adjacent to its flagship Copalquin district.
• The transaction involves an initial payment of $25,000 USD and 50,000 shares, with a total option exercise price of $4 million USD payable over a 48-month period.
• Mithril is committed to conducting lidar and aerial magnetic surveys in the first year and spending a minimum of $200,000 USD on exploration in the second year.

Key Details

• Target Property: La Dura gold-silver property, consisting of five contiguous mining concessions totaling 2,052 hectares.
• Location: Durango state, Mexico; less than 5 km from El Durazno and less than 20 km from Mithril’s Copalquin flagship property.
• Historical Context: Hosts a four-level historic mine with a 60-tonne-per-day processing facility; last operated in 2013. Contains a large historic database of mining records from the 1990s to 2018.
• Option Structure:
  • Initial Payment: $25,000 USD and 50,000 ordinary shares (subject to a 4-month hold period).
  • Exercise Price: $4 million USD to acquire 100% interest at any time within 48 months.
  • Payment Schedule:
    • 12-month anniversary: $30,000 USD
    • 18-month anniversary: $30,000 USD
    • 24-month anniversary: $50,000 USD
    • 30-month anniversary: $50,000 USD
    • 36-month anniversary: $50,000 USD
    • 42-month anniversary: $50,000 USD
  • Payment Method: Vendor may elect to receive all or part of the $4 million in shares if Mithril’s 20-day VWAP is ≥ $1.00 USD; Mithril may elect cash-only payment.
• Exploration Commitments:
  • Year 1: Complete lidar and aerial magnetic surveys.
  • Year 2: Minimum direct exploration spend of $200,000 USD.
  • No further exploration expenditure commitments.
• Royalty Terms: If purchased, vendor retains a 2.5% NSR (Net Smelter Return), reducible to 1% by paying $2.5 million USD.
• Copalquin Context: La Dura is adjacent to Copalquin, where drilling is progressing at targets 1 and 5, with target 3 scheduled to commence in January 2026. Copalquin holds a maiden JORC resource of 691,000 tonnes indicated and 1,725,000 tonnes inferred.

Notable Quotes

• "The historic La Dura mine was a notable past producer, and the local geology provides potential to host gold and silver mineralization across the 20-square-kilometre mining concession area," said John Skeet, managing director and chief executive officer.
• "Mithril has a strong foundation of knowledge at La Dura, with management having completed exploration work on the property in 2017 to 2018. The team's proven technical strengths and discovery experience at Copalquin position the company well to unlock value at La Dura."