28
CORPORATE PRESENTATION CIBC 20TH ANNUAL WHISTLER INSTITUTIONAL INVESTOR CONFERENCE JANUARY 25 - 28, 2017
CORPORATE PRESENTATION
CIBC 20TH ANNUAL WHISTLER INSTITUTIONAL
INVESTOR CONFERENCE JANUARY 2 5 - 2 8 , 2 017
CAUTIONARY NOTES
2
Cautionary Note Regarding Forward-Looking Information
This presentation contains certain information that may constitute forward-looking information under applicable Canadian and U.S. securities legislation, including but not
limited to information about results of exploration, development, mining, evaluation activities, results of reclamation activities, the estimation or realization of mineral
resources and mineral reserves, the timing and amount of estimated future production, the making of future production decisions, expectations regarding realization of
synergies relating to Klondex's projects, the timing and receipt of required permits and approvals, capital expenditures, costs and timing of the development of new mineral
deposits, requirements for additional capital, the sufficiency of working capital and liquidity, and the future prices of precious and base metals. This forward-looking
information entails various risks and uncertainties that are based on current expectations, and actual results may differ materially from those contained in such
information. These uncertainties and risks include, but are not limited to, the strength of the global economy; the price of gold; operational, funding and liquidity risks; the
degree to which mineral resource and mineral reserve estimates are reflective of actual mineral resources and mineral reserves; the degree to which factors which would
make a mineral deposit commercially viable are present; the risks and hazards associated with underground operations; and the ability of Klondex to fund its substantial
capital requirements and operations. Risks and uncertainties about the Company’s business are more fully discussed in the Company’s disclosure materials filed with the
securities regulatory authorities in Canada and the U.S. and available at www.sedar.com and www.SEC.gov, respectively. Readers are urged to read these materials. Klondex
assumes no obligation to update any forward-looking information or to update the reasons why actual results could differ from such information unless required by law.
U.S. Cautionary Note Regarding the Use of Mining Terms
This presentation has been prepared in accordance with the requirements of the securities laws in effect in Canada, which differ from the requirements of U.S. securities
laws. All resource and reserve estimates included in this presentation have been prepared in accordance with NI 43-101. NI 43- 101 is a rule developed by the Canadian
Securities Administrators that establishes standards for all public disclosure an issuer makes of scientific and technical information concerning mineral projects. These
standards differ significantly from the mineral reserve disclosure requirements of the U.S. Securities and Exchange Commission (the “SEC”) set out in industry guide 7. In
particular, the SEC’s industry guide 7 applies different standards in order to classify mineralization as a reserve. As a result, the definitions of proven and probable reserves
used in NI 43-101 differ from the definitions in SEC industry guide 7. Under SEC standards, mineralization may not be classified as a “reserve” unless the determination has
been made that the mineralization could be economically and legally produced or extracted at the time the reserve determination is made. However, Klondex’s estimated
proven and probable reserves previously reported under NI 43-101 for Fire Creek, Midas and True North are equivalent to those determined under SEC Industry Guide 7.
This presentation also uses the terms “resources”, “measured resources”, “indicated resources” and “inferred resources”. United states investors are advised that, while
such terms are recognized and required by Canadian securities laws, the SEC does not recognize them. Mineral resources that are not mineral reserves do not have
demonstrated economic viability. United States investors are cautioned not to assume that all or any part of measured or indicated resources will ever be converted into
reserves. Further, inferred resources have a great amount of uncertainty as to their existence and as to whether they can be mined legally or economically. It cannot be
assumed that all or any part of the inferred resources will ever be upgraded to a higher category. Disclosure of “contained ounces” in a resource is permitted disclosure
under Canadian regulations; however, the SEC normally only permits issuers to report mineralization that does not constitute “reserves” by SEC standards as in- place
tonnage and grade without reference to unit measures. Consequently, resource information contained in this presentation is not comparable to similar information that
would generally be disclosed by U.S. companies in accordance with the rules of the SEC.
Qualified Person
Brian Morris, Vice President, Exploration of Klondex Mines is a "qualified person" as defined by National Instrument 43-101 – Standards of Disclosure for Mineral Projects
(NI 43-101) and has reviewed and is responsible for the technical information contained in this presentation.
Three Flagship Assets
in Nevada; Aurora provides
additional optionality
True North developing
into our third significant
operation in North America
Consolidating in
Northern Nevada –
three mines serviced
by one central mill
GAINING SCALE IN NORTH AMERICAGROWING PRODUCTION PROFILE, STRONG UPSIDE POTENTIAL
3
PAUL ANDRÉ HUET, A.Sc.T.
PRESIDENT, CEO AND DIRECTOR
29 years of mining experience within
North America, focused on underground
narrow vein gold and silver mining
MIKE DOOLIN
CHIEF OPERATING OFFICER
28 years with extensive experience in
metallurgy, design, and permitting of
narrow vein and open pit mining projects
BARRY DAHL
CHIEF FINANCIAL OFFICER
29 years of accounting experience
in mining, construction,
and manufacturing
JOHN SEABERG
SVP INVESTOR RELATIONS AND
CORPORATE DEVELOPMENT
23 years metals and mining experience
with major mining companies in
North America, focusing on Investor
Relations and Corporate Development
BRIAN MORRIS
VP EXPLORATION
28 years experience providing
exploration and geological support
to major producing assets in Nevada,
including Midas and Hollister
EXECUTIVE MANAGEMENT TEAMTRACK RECORD OF EXECUTION
JOHN ANTWI
SVP STRATEGIC DEVELOPMENT
25 years of mining industry experience
– most recently served as the regional
director for business development for
Newmont Mining Corp. in North America
4
*See “Non-GAAP Performance Measures at the end of the presentation.
*See press release dated January 18, 2017
COMPELLING VALUE PROPOSITION
5
MANAGEMENT
TRACK RECORD
• No LTA’s for ~4 years at Fire Creek, ~2 years at Midas and ~1 year at True North
• Significant experience in narrow vein underground mining
• On track to achieve full year financial and operational targets
GROWING
PRODUCER IN
NORTH AMERICA
Flagship Assets in Nevada:
• Fire Creek and Midas; Recently acquired Hollister Mine and Aurora Mine and Mill
Gaining Scale in Canada:
• True North in Manitoba, Canada
HIGH GRADE
OPERATIONS;
STRONG FCF
GENERATION
• Operate two of the highest grade mines in North America; increases to four with True North and Hollister
• One of the lowest cost, highest grade producers in the industry
• Q4 & 2016 FY production of 51,833 and 160,457 GEOs respectively - a record year
• 2017 Guidance of ~210,000 to 225,000 GEOs, at cash costs per GEO of $680 - $710*
SIGNIFICANT
EXPLORATION
POTENTIAL
• Fire Creek – High grade mineralization in both new and existing veins
• Midas – Significant mineralization discovered to the West and South of main workings
• Hollister – Underground exploration potential in Gloria West and Hatter Graben
• True North – Significant exploration and project development work in process
BALANCE SHEET
STRENGTH
• Significant liquidity, ~$183 million as of October 31, 2016
• Aggressively investing in our best assets
HOLLISTER
ACQUISITION
OPPORTUNITY
• Fully permitted, high grade underground operation with infrastructure in place
• Lower risk due to management’s intimate knowledge of assets
• Significant synergies with Midas Mill –consolidates three projects in Northern Nevada
• Additional upside potential with Aurora mine and milling complex
6
Three months ended December 31, 2016 Twelve months ended December 31, 2016
Fire Creek MidasNevada
TotalTrue
NorthTOTAL Fire Creek Midas
Nevada Total
True North
TOTAL
ORE TONS MILLED 27,721 53,809 81,530 63,962 145,492 120,553 190,982 311,535 95,710 407,245
AVERAGE GOLD EQUIVALENTMILL HEAD GRADE
(OZ/TON)(1)
1.07 0.32 0.57 0.14 0.38 0.91 0.27 0.52 0.11 0.42
GOLD EQUIVALENT PRODUCED (OUNCES)(1) 27,873 15,391 43,264 8,445 51,833 102,352 47,747 150,099 10,198 160,457
GOLD EQUIVALENT SOLD(OUNCES)(1) 27,342 13,162 40,504 7,028 47,656 99,986 50,082 150,068 8,028 158,260
CONSOLIDATED OPERATIONAL HIGHLIGHTS
• No lost time injuries at any of our operations
• 2016 YTD production of 160,457 GEOs; increase of ~26% from prior year
• Q4 production of 51,833 GEOs: a record for the company – ~40% increase from
third quarter of 2016
*See press release dated January 18, 2017
(1) Gold equivalent ounces ("GEO") and grades are computed as the applicable gold ounces/grade plus the silver ounces/grade divided by a GEO ratio. GEO ratios are computed by dividing the average realized gold price per ounce by the average realized silver price per ounce received by the Company in the respective period. Preliminary GEO ratios for each respective segment are as follows:
GEO Ratio 72.1 73.2 72.4 71.3 71.4 75.6 75.1 74.7 73.1 74.5
GEO Production Cash Costs per GEO Sold(1) CapEx ($M)
LOW HIGH LOW HIGH LOW HIGH
MIDAS 42,000 45,000 $925 $950 $11 $12
MIDAS MILL – – – – $4 $5
FIRE CREEK 97,000 100,000 $475 $500 $27 $29
HOLLISTER(2) 30,000 35,000 $935 $960 – –
NEVADA TOTAL 169,000 180,000 $670 $700 $42 $46
TRUE NORTH(3) 41,000 45,000 $725 $750 $15 $16
CONSOLIDATED TOTAL 210,000 225,000 $680 $710 $57 $62
7
• ~36% production growth YoY
• Operating 4 mines, 3 mills in
2 countries
2017 OPERATIONAL GUIDANCE
(1) This is a non-GAAP measure; refer to the Non-GAAP Performance Measures section of this Presentation for additional detail.(2) The guidance will be updated, as required, upon completion of a technical report for the Gloria zone, expected to be completed in the second quarter of 2017.(3) Based on an estimated CDN:US dollar exchange rate of 0.75:1.
*See press release dated January 18, 2017
LOW HIGH
CORPORATE G&A ($M) $15 $17
HOLLISTER DEVELOPMENT ($M) $7 $9
REGIONAL EXPLORATION EXPENSE ($M) $3 $5
ALL-IN COSTS PER GOLD OZ SOLD(1) $1,070 $1,130
8
EVOLVING INTO MID-TIER PRODUCER
CONSOLIDATED STATISTICS Q4 2016 FY 2016
Production (GEOs) 43,264 150,099
Sales (GEOs) 40,504 150,068
Tons per day milled 886 tpd 854 tpd
Mill head grade (AuEq) 0.57 opt 0.52 opt
Recovery93.7% Au
84.0% Ag
93.7% Au
86.7% Ag
• YTD production of 150,099 GEOs; above the top end of our guidance of 150,000 GEOs
• Increased average GEO mill head grade by ~4% from the third quarter of 2016
9
NEVADA OPERATIONAL HIGHLIGHTS
FIRE CREEK STATISTICS Q4 2016 FY 2016
Production (GEOs) 27,873 102,352
Sales (GEO)s 27,342 99,986
Tons per day milled 301 tpd 330 tpd
Mill head grade (AuEq) 1.07 opt 0.91 opt
Recovery93.8% Au
84.4% Ag
93.6% Au
86.6% Ag
10
FIRE CREEK OPERATIONAL HIGHLIGHTS
• 2016 YTD production of 102,352 GEOs; increase of ~31% from prior year
• Average GEO mill head grade of 1.07 opt; ~9% increase from the third quarter of
2016
• Produced ~53% more ore tons at ~65% higher grades due to additional longhole
stoping
MIDAS STATISTICS Q4 2016 FY 2016
Production (GEOs) 15,391 47,747
Sales (GEOs) 13,162 50,082
Tons per day milled 585 tpd 523 tpd
Mill head grade (Au Eq) 0.32 opt 0.27 opt
Recovery93.5% Au
83.9% Ag
93.9% Au
86.7% Ag
11
MIDAS OPERATIONAL HIGHLIGHTS
• Average GEO mill head grade of 0.32 opt; ~14% increase from the third quarter
of 2016
• Longhole silling and stoping mining width reduced by ~15%; mining head grades
increased by ~22%
TRUE NORTH STATISTICS Q4 2016 FY 2016
Production (Au Eq oz) 8,445 10,198
Sales (Au Eq oz) 7,028 8,028
Tons milled 695 tpd 262 tpd
Mill head grade (Au Eq) 0.14 opt 0.11 opt
Recovery 93.4% Au 92.7% Au
Before Klondex Now
• P&P Mineral Reserve of 85.5k(1) Au oz plus 32.4k Au oz
in tailings
• M&I Mineral Resource is 294k(2) Au oz
• Inferred Mineral Resources of 460k Au oz at 0.17 opt Au(1)
• Stopped Tailing Reprocessing Project in Q4 for the winter;
began processing the stockpiled ore from the mine
12
TRUE NORTH OPERATIONAL HIGHLIGHTS
(1) Proven Reserves of 36.7 Au koz (153k tons at 0.241 opt Au) and Probable Reserves of 48.8 Au koz (199k tons at 0.245 opt)
(2) Measured Resource of 106 Au koz (455k tons at 0.232 opt) and Indicated Resource of 188 Au koz (931k tons at 0.202 opt)
*See U.S Cautionary Note Regarding the Use of Mining Terms
True North
Course gold on shaker table
13
TRUE NORTHHIGHLIGHTS: 710/711, COHIBA ZONES, AND SAM EXPLORATION
*See Press Release dated January 24, 2017
645-16-0030.67 opt Au over 2.4 ft
23 g/t over 0.7 m
645-16-0040.53 opt Au over 12 ft
18.2 g/t over 3.7 m
645-16-002 0.95 opt Au over 5.9 ft
32.5 g/t over 1.8 m
New Discovery26-16-001
0.36 opt Au over 15.0 ft12.3 g/t over 4.6 m
711 up-dip drilling ongoing
710 down-dip drilling ongoing
32-16-0060.33 opt Au over 9.7 ft
11.3 g/t over 3.0 mAnd
0.20 opt Au over 16.5 ft7.0 g/t over 5.0 m
32-16-003A 1.13 opt Au over 2.3 ft
38.8 g/t over 0.7 m
Cohiba
007
• Purchase price of $80M cash plus shares and warrants
Hollister
• A high-grade, fully permitted (EIS in hand) underground gold mine ~19 miles from
the Midas mill
– Historical production from 2007 - 2012 of ~425,000 GEOs at an average grade
of ~1.0 opt
• High grade underground potential
• Significant exploration potential
• Klondex management has extensive experience and knowledge of the asset
Aurora (formerly known as Esmeralda)
• Fully permitted mine and ~350 tpd milling complex with new, unused tailings facility
• Significant exploration potential; property has produced in excess of 1.5M Au oz
14
HOLLISTER/AURORA ACQUISITIONOVERVIEW
15
• Power costs significantly reduced when
connected to the grid
• Powerline and surface exploration now
possible with EIS on hand
• EIS includes permitting for secondary
ramp at Hatter Graben
• Drifting extended Gloria zone
~1,200 ft to the West
• New and improved dewatering system
HOLLISTER/ AURORA ACQUISITION
Shorter Trucking Distance to Mill – Lower Transportation Costs
• Hollister to Aurora mill (~277 miles @ ~$100/t) vs Midas mill
(~19 miles @ ~$10/t); Realizable saving of ~$90/t
Lower Milling Costs
• Aurora milling cost (~$96/t) vs Midas mill cost (~$46/t);
Realizable saving of ~$50/t
Lower Power Costs
• $17M spent on completing power line; expected to reduce power costs to
~$0.07/kWh from ~$0.66/kWh; Realizable saving of ~$50/t
Reduced G&A Costs
• Will share G&A associated with established Midas and Fire Creek operations
16
HOLLISTER/AURORA ACQUISITIONPOTENTIAL SYNERGIES OF ~$15M ANNUALLY
Currently ~1,800 ft of strike,
and vertical extension of
~1,200 ft
GLOR15 – 034:
18.36 opt AuEq over
1.7ft
Gloria West
Vein SystemOpen
500 ft
Hatter Graben Vein System
Open In All Directions
H8 – 285:
0.47 opt Au
over 12.5 ft
Currently ~1,800 ft of strike
and vertical extension
of ~1,200 ft
H8 – 269:
1.77 opt Au
over 2.1 ft
GLOR15 – 034:
18.36 opt AuEq
over 1.7ft
17
HOLLISTER PROPERTYHATTER GRABEN VEIN SYSTEM
18
AURORA PROPERTYSIGNIFICANT EXPLORATION POTENTIAL
1000 FT N
HUMBOLDT PIT
SILICA RIBS
– HIGH LEVEL EXPOSURE
PROSPECTUS PIT
ANN PITChannel
Sample Assay
0.49 Au opt
0.56 Au opt MVG drill hole
Intercept: 5 feet @ 0.93
opt Au
MILESTONES ACHIEVED TO DATE
NO LOST TIME INCIDENTS
RECEIVED ENVIRONMENTAL ASSESSMENT AT FIRE CREEK
ACQUIRED THE TRUE NORTH MINE AND MILL IN MANITOBA, CANADA
SECURED $25 MILLION REVOLVING CREDIT FACILITY; INCREASED TO $35
POSITIVE PRODUCTION DECISION MADE AT TRUE NORTH; SUCCESSFULLY RECOVERING GOLD FROM
TAILINGS
ADDED TO THE GDX, GDXJ, AND TSX COMPOSITE INDICES
ISSUED INITIAL MINERAL RESERVE AND RESOURCE ESTIMATE AT TRUE NORTH
COMPLETED C$129.5M BOUGHT DEAL EQUITY FINANCING FOR HOLLISTER/AURORA ACQUISITION
CLOSED HOLLISTER/AURORA ACQUISITION
ACHIEVED 2016 FULL YEAR PRODUCTION GUIDANCE
ADDITIONAL OBJECTIVES
ADVANCE DISTRICT EXPLORATION AT FIRE CREEK AND MIDAS
MINERAL RESOURCE ESTIMATE AND DETAILED MINE PLAN AT HOLLISTER – Q2 2017
MINERAL RESOURCE UPDATE AT TRUE NORTH – Q1 2017
DELIVER 2017 GUIDANCE OF 210,000 TO 225,000 GEOS
19
DELIVERING ON OUR COMMITMENTS
For More Information
John SeabergSVP Investor Relations and
Corporate Development
Office 775.284.5757
Cell 303.668.7991
TRACK RECORD OF OPERATIONAL EXCELLENCEMIDAS POST-ACQUISITION IMPROVEMENTS
• Reduced workforce by 50%
• Transferred 25% of the equipment
for use at Fire Creek – reduced
2014 capex by ~$7 million
• Increased resource, doubled grade
to the mill
• Pre-KDX AuEq grade: 0.15 opt
vs. 2015 head grade 0.30 opt
• 2 yard scoops, from 4 yard scoops
• Jumbo’s replaced by handheld drills
• 6-8’ wide ore drifts, down from 12’
• Apply cut and fill mining from raises
in appropriate locations
Note: Please see the press release dated September 16, 2015 and the technical report titled "Preliminary Feasibility Study for the Midas Mine,
Elko County, Nevada", as amended and re-filed April 2, 2015 (effective date of January 31, 2014) on SEDAR for details regarding the mineral
resources disclosed herein, including details regarding the key assumptions, parameters and methods used to estimate the mineral resources.
A-1
Q3 2016 Q3 2015
Revenue $53.0M $38.4M
Income from Operations $13.1M $6.3M
Net Income $7.2M $4.1M
Net Income Per Share (basic) $0.05 0.03
Average Realized
Gold Price (US$/oz)$1,276 $1,135
Average Realized
Silver Price (US$/oz)$17.26 $14.78
Capital Expenditures (2) $20.8M $12.7M
(1) Excludes True North. See “Non-IFRS Performance Measures” at the end of the presentation
(2) Includes $3.8 million of capex at True North.
• Sold 7,700 more GEOs,
including first 1,000 gold
ounces from True North
• ~38% increase in revenue,
higher realized prices of
$141 per gold oz and
$2.48 per silver oz
• Net income of $0.05 per
share, inclusive of business
acquisition costs and currency
losses from exchanging equity
proceeds into US$
• Capital spending on budget
SELECTED FINANCIAL DATASOLID FINANCIAL RESULTS (UNAUDITED)
A-2
(US$M) Q3 2016 Q2 2016
Cash Flow
from Operations$16.6 $23.6
Cash Balance $131.1 $36.9
Working Capital $119.9 $29.5
Secured Promissory
Note$11.4 $11.3
(1) Metal inventory is the value of the estimated recoverable gold and silver
ounces contained in our Inventories if sold at September 30, 2016 period-
end London PM fix prices.
(2) LOC was increased by $10M to $35 in October 27, 2016
(3) $80M of cash was paid to Waterton on October 3, 2016
~$183 Million of Available Liquidity
BALANCE SHEET STRENGTHIMPROVING LIQUIDITY AND WORKING CAPITAL
A-3
BUY-SIDE OUTREACHSHIFTING FOCUS TO INSTITUTIONAL INVESTORS
CURRENT SHAREHOLDERS LOCATION % OWNERSHIP
SENTRY INVESTMENTS Toronto, ON 10.87%
VAN ECK ASSOCIATES New York, NY 10.01%
K2 & ASSOCIATES Toronto, ON 8.4%
U.S. GLOBAL INVESTORS San Antonio, TX 8.17%
OPPENHEIMER New York, NY 4.94%
FIDELITY (CANADA) AM Toronto, ON 4.61%
SPROTT AM Toronto, ON 2.65%
O'SHAUGHNESSY AM Stamford, CT 2.35%
TOCQUEVILLE AM New York, NY 2.21%
BMO AM Toronto, ON 1.44%
*Source: FactSet - January 10, 2017
A-4
MINERAL RESERVES
Fire Creek Mineral Reserves
A-5
Category Tons (k) Au opt Au g/t Au koz
Proven 153 0.241 8.26 36.7
Probable 199 0.245 8.40 48.8
Total P&P 352 0.243 8.33 85.5
Category Tons (k) Au opt Au g/t Ag opt Ag g/t AuEq opt AuEq g/t Au koz Ag koz AuEq koz
Proven 121 1.703 58.40 1.37 47.1 1.722 59.05 206 166 208
Probable 119 0.715 24.51 0.50 17.0 0.722 24.74 85 59 86
Total P&P 240 1.213 41.59 0.94 32.2 1.226 42.03 291 225 294
Midas Mineral Reserves
True North Mineral Reserves
Category Tons (k) Au opt Au g/t Ag opt Ag g/t AuEq opt AuEq g/t Au koz Ag koz AuEq koz
Proven 141 0.261 8.95 9.18 314.8 0.388 13.31 37 1,295 55
Probable 307 0.335 11.47 3.84 131.6 0.388 13.29 103 1,180 119
Total P&P 449 0.311 10.68 5.52 189.2 0.388 13.30 140 2,475 174
Note: See Notes to Mineral Reserves and Mineral Resources on slide A - 7.
Category Tons (k) Au opt Au g/t Au koz
Probable 1,170 0.028 0.96 32.4
True North Tailings Mineral Reserves
Category Tons (k) Au opt Au g/t Au koz
Measured 455 0.232 7.95 106
Indicated 931 0.202 6.93 188
Total M&I 1,386 0.212 7.27 294
Inferred 2,793 0.165 5.66 460
Category Tons (k) Au opt Au g/t Ag opt Ag g/t AuEq opt AuEq g/t Au koz Ag koz AuEq koz
Measured 180 1.637 56.12 1.30 44.7 1.655 56.74 294 234 298
Indicated 346 0.591 20.27 0.51 17.5 0.598 20.50 205 176 207
Total M&I 526 0.948 32.52 0.78 26.8 0.959 32.89 499 411 505
Inferred 931 0.538 18.43 0.48 16.4 0.544 18.66 501 446 507
Category Tons (k) Au opt Au g/t Ag opt Ag g/t AuEq opt AuEq g/t Au koz Ag koz AuEq koz
Measured 417 0.400 13.72 7.97 273.4 0.511 17.51 167 3,325 213
Indicated 697 0.362 12.41 4.73 162.1 0.428 14.66 252 3,295 298
Total M&I 1,114 0.376 12.90 5.94 203.7 0.459 15.73 419 6,620 511
Inferred 671 0.303 10.39 2.93 100.5 0.344 11.79 203 1,966 231
Note: See Notes to Mineral Reserves and Mineral Resources on slide A - 7.
Fire Creek Mineral Resources
Midas Mineral Resources
True North Mineral Resources
A-6
MINERAL RESOURCES
Category Tons (k) Au opt Au g/t Au koz
Indicated 2,138 0.024 0.82 51.0
Inferred 47 0.022 0.75 1.1
True North Tailings Mineral Resources
Notes to Nevada’s Mineral Reserve and Resource
1. Mineral Resource is inclusive of Mineral Reserve.
2. Fire Creek and Midas Mineral Reserves are calculated at a gold price of US$1,200 per ounce and a silver price of US$17.00 per ounce.
3. Fire Creek and Midas Mineral Resources are calculated at a gold price of US$1,400 per ounce and a silver price of US$19.83 per ounce.
4. Metallurgical recoveries for gold and silver are 94% and 92%, respectively, at all properties.
5. One ounce of gold is equivalent to 72.12 ounces of silver.
6. Mineral Resources include resource dilution to a minimum mining width of four feet or the vein width plus two feet, whichever is greater.
7. Cut off grades for the Mineral Resources at Fire Creek and Midas are 0.228 and 0.196 opt AuEq, respectively.
8. Cut off grade for the Mineral Reserves at Fire Creek and Midas are 0.343 and 0.305 opt AuEq, respectively.
9. The effective date for the Fire Creek and Midas Mineral Resource is June 30, 2016 and May 31, 2016, respectively.
10. Mineral Resources which are not Mineral Reserves do not have demonstrated economic viability. The estimate of Mineral Resources may be materially affected by environmental,
permitting, legal, title, taxation, sociopolitical, marketing, or other relevant issues.
11. The quantity and grade of reported Inferred Resources in this estimation are uncertain in nature and there has been insufficient exploration to define these Inferred Resources as
an Indicated or Measured Mineral Resource and it is uncertain if further exploration will result in upgrading them to an Indicated or Measured Mineral Resource category.
12. The Mineral Resources in this press release were estimated using the Canadian Institute of Mining, Metallurgy and Petroleum (CIM), CIM Standards on Mineral Resources and
Reserves, Definitions and Guidelines prepared by the CIM Standing Committee on Reserve Definitions and adopted by CIM Council.
Notes to True North Mineral Reserve and Resource
1. Mineral Resource is inclusive of Mineral Reserve.
2. Mineral Reserve is calculated at a gold price of C$1,500 per ounce.
3. Mineral Resource is calculated at a gold price of C$1,750 per ounce.
4. US$:CDN$ exchange rate is 0.80.
5. Metallurgical process recovery for gold is 94%.
6. Mineral Resource include resource modeling dilution to a minimum width of four feet or the vein width, whichever is greater.
7. Mineral Reserve includes mining dilution and is constrained to a five foot minimum mining width.
8. Cut off grade for the Resource is 0.09 opt Au.
9. Cut off grade for the Reserve is 0.13 opt Au which includes a mining cost of C$69/ton, processing cost of C$28/ton, G&A cost of C$45/ton and sustaining development cost of
C$42/ton.
10. Mineral Resource and Reserve tonnage calculations used a bulk density 0.086 tons/cu. ft.
11. Mining losses of 2% have been applied to the designed mine excavations, and no additional unplanned dilution has been applied.
12. The effective date for Mineral Reserve and Resource is June 30, 2016.
13. Mineral Resources which are not mineral reserves do not have demonstrated economic viability. The estimate of Mineral Resources may be materially affected by environmental,
permitting, legal, title, taxation, sociopolitical, marketing, or other relevant issues.
14. The quantity and grade of reported Inferred Resources in this estimation are uncertain in nature and there has been insufficient exploration to define these Inferred Resources as
an Indicated or Measured Mineral Resource and it is uncertain if further exploration will result in upgrading them to an Indicated or Measured Mineral Resource category.
15. The Mineral Resources in this press release were estimated using the Canadian Institute of Mining, Metallurgy and Petroleum (CIM), CIM Standards on Mineral Resources and
Reserves, Definitions and Guidelines prepared by the CIM Standing Committee on Reserve Definitions and adopted by CIM Council.
(1)See press releases dated September 12, 2016 and September 14, 2016
A-7
NOTES TO MINERAL RESERVES AND RESOURCES
Notes to True North Tailings Mineral Reserve
1. Tailings Mineral Resource is inclusive of Mineral Reserves.
2. Tailings Mineral Reserve estimate is based on tailings located at True North produced by previous operators to Klondex.
3. Tailings Mineral Reserve was estimated using the Canadian Institute of Mining, Metallurgy and Petroleum (CIM), CIM Standards on Mineral Resources and Reserves, Definitions
and Guidelines prepared by the CIM Standing Committee on Reserve Definitions and adopted by CIM Council.
4. No mining losses have been applied to the designed historic tailing excavations and no additional unplanned dilution has been included.
5. Contained metal may differ due to rounding.
6. Cut-off grade = 0.026 opt Au (0.89 g/t Au) for 2016 to 2018 and 0.020 opt Au (0.69 g/t Au) for 2019 to 2023
7. A dry bulk density of 0.044 tons per cubic foot was utilized in the tailings Mineral Reserve tonnage calculation.
Notes to True North Tailings Mineral Resource
1. Tailings Mineral Resource is inclusive of Tailings Mineral Reserve.
2. Tailings Mineral Resource estimate is based on tailings located at True North produced by previous operators to Klondex.
3. Mineral Resources which are not Mineral Reserves do not have demonstrated economic viability. The estimate of Mineral Resources may be materially affected by environmental,
permitting, legal, marketing, or other relevant issues.
4. Mineral Resource was estimated using the Canadian Institute of Mining, Metallurgy and Petroleum (CIM), CIM Standards on Mineral Resources and Reserves, Definitions and
Guidelines prepared by the CIM Standing Committee on Reserve Definitions and adopted by CIM Council.
5. The quantity and grade of reported Inferred Mineral Resources in this estimation are uncertain in nature and there has been insufficient exploration to define these Inferred
Mineral Resources as an Indicated or Measured Mineral Resource and it is uncertain if further exploration will result in upgrading them to an Indicated or Measured Mineral
Resource category.
6. Contained metal may differ due to rounding.
7. Cut-off grade = 0.015 opt Au (0.51 g/t Au).
8. A dry bulk density of 0.044 tons per cubic foot per cubic foot was utilized in the tailings Mineral Resource estimate tonnage calculation.
(1)See press releases dated October 27, 2016
A-8
NOTES TO MINERAL RESERVES AND RESOURCES
