Mr. Frederick Davidson of Impact Silver reports

IMPACT SILVER ANNOUNCES OPTION AGREEMENT WITH J2 METALS INC. ON A PORTION OF ZACUALPAN S.E.

Impact Silver Corp. has executed a letter of intent to option a portion of the Zacualpan southeastern area, which forms part of the approximately 211-square-kilometre Zacualpan mining district, to J2 Metals Inc. J2 has renamed the optioned area the Sierra Plata silver-antimony project. Under the agreement, J2 will conduct exploration on the approximately 22-square-kilometre property over a three-year period. The definitive agreement is expected to close within 60 days.

Fred Davidson, president and chief executive officer of Impact Silver, commented: "While Impact's strategy is focused on near-term increases in brownfield exploration and production opportunities close to our processing facilities, transactions such as this, partnering with a funded and experienced junior exploration team, allow us to unlock additional value and exploration upside without deploying our own financial or human capital. Against a backdrop of record silver prices, our team remains focused on optimizing existing operations, and we are excited to participate in J2's success as it advances exploration across this prospective area."

The area is located on the northwestern extension of the renowned Taxco mining district, a region with a centuries-long history of continuous silver-gold exploration and production. While this specific area lies beyond economical trucking distance of Impact's existing processing facilities, Impact has completed reconnaissance and limited exploration work on the property with encouraging results to date, highlighting its stand-alone exploration potential.

Terms of option

Upon execution of a definitive agreement, J2 may earn a 100-per-cent interest in the property by making staged payments to Impact and incurring exploration expenditures, as follows:

1. $250,000 in J2 common share subscription receipts within three days of TSX Venture Exchange approval of the LOI;
2. Approximately $1,353,600 in qualifying exploration expenditures, to be incurred in stages over three years; and
3. Staged annual payments to Impact totalling up to 6.5 million common shares of J2, with up to 25 per cent of the share value at the time of issuance payable in cash, or up to $375,000 in cash, over three years.

J2 will also be responsible for work requirements and taxes related to keeping the property in good standing over the course of the agreement. As well, J2 maintains the right to accelerate cash payments and issuances of J2's common shares at any time after the first year following the date of the agreement, by paying an additional $500,000 in cash, J2 common shares or a combination thereof at Impact's election.

Impact will retain a 1.5-per-cent net smelter return royalty on the project, with J2 having the right to buy down the royalty to 0.75 per cent upon payment of $1.5-million.

The transaction will be subject to TSX Venture Exchange approval.

About Impact Silver Corp.

Impact Silver is a successful producer-explorer with two mining projects in Mexico:

• Royal Mines of Zacualpan silver-gold district: Impact owns 100 per cent of the 211-square-kilometre Zacualpan project in central Mexico where four producing underground silver mines and one open-pit mine feed the central 500-tonne-per-day Guadalupe processing plant. To the south, the Capire project includes a 200-tonne-per-day processing pilot plant adjacent to an open-pit silver mine with a National Instrument 43-101 inferred mineral resource of over 4.5 million ounces silver, 48 million pounds zinc and 21 million pounds lead (see Impact news release dated Jan. 18, 2016, for details and qualified person statement). Company engineers are reviewing Capire for a potential restart of operations to leverage improving commodity prices. Over the past 19 years, Impact has developed multiple exploration zones into commercial production and has produced over 13.7 million ounces of silver, generating revenue of more than $307-million, with no long-term debt.
• Plomosas zinc-lead-silver district: Plomosas is a high-grade zinc producer in northern Mexico with exceptional exploration upside potential. The company recently restarted mining operations and is ramping up production. Exploration potential at Plomosas is exceptional along the six-kilometre-long structure. This is in addition to other exploration targets on the 3,019-hectare property including untested copper-gold targets with indications of high-grade material at surface. Regionally, Plomosas lies in the same mineral belt as some of the largest carbonate replacement deposits in the world.

George Gorzynski, PEng, a director of the company, is a qualified person within the meaning of NI 43-101 and has approved the technical information contained in this news release.

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