Mr. Thomas Kennedy reports

KLONDIKE SILVER ISSUES UNITS FOR DEBT

Klondike Silver Corp. has issued units for debt to various arm's-length parties. The various parties have agreed to a total of 2,233,072 units to be issued for a total value of $111,653 (which includes original loan amounts plus interest at 10 per cent). Each unit consists of one common share and a share purchase warrant exercisable at five cents for a period of five years. The units are being issued at a deemed price of five cents each. The shares are subject to a four-month-and-one-day hold period from date of issue, in accordance with the policies of the TSX Venture Exchange and applicable securities law. The TSX Venture Exchange has accepted the terms for the debt settlement.

About Klondike Silver Corp.

Klondike's Silvana mine silver-zinc-lead project is located in southeastern British Columbia. Klondike's 114-square-kilometre claim block is 138 kilometres north of the Trail, B.C., smelter. Klondike Silver is exploring from underground, along the nine-kilometre main lode. The main lode is the most prolific mineralized structure in the Slocan mining camp. There are 13 past-producing mines that are situated along the main load, which have produced 886,000 kilograms of silver, 95 million kilograms of zinc and 117 million kilograms of lead so far. There are 67 past-producing mines that are situated in Klondike Silver's 114-square-kilometre claim block.

We seek Safe Harbor.