|

Dear Riverside shareholders and followers,

First, we hope you and your family are keeping well and safe and that the COVID-19 pandemic has not been too challenging during these difficult and unprecedented times. I am happy to inform you that Riverside’s team has managed to stay healthy and is progressing our activities while working remotely.

During April, Riverside worked on a number of fronts which we look to bear fruit in the coming months. The key projects include the spin out of the Peñoles Project into Capitan Mining and advancing the high-grade gold (up to 18 g/t Au) and drill permit approved Los Cuarentas Project in Sonora, Mexico. Riverside is also progressing our Mexico exploration program funded by BHP and completing activities related to advancing our Canadian gold project portfolio. On all these fronts, we have had to make adjustments to the work schedules in response to the constraints that the COVID-19 pandemic has brought about and appreciate that we are getting through these tough conditions. Much of our work has involved advancing “non field" activities such as technical reports, government filings, asset farm out data packages and planning summer field work.

In our communications with our shareholders we have received a few common questions and I wanted to take a moment to provide some guidance to our investors.

How is Progress with the Spin Out of Capitan Mining?

Some of our shareholders have inquired about the process and timing for participating in the Capitan Mining financing directly, or had questions about indirectly gaining exposure to the new spin-out through acquiring/owning RRI shares. The process involves a number of milestones. First, we are pleased to report that the AGM approved 99.7% in favor of the spin-out, which passed on March 31st and during April we were granted approval by the BC Supreme Court for the spin-out arrangement of Capitan Mining Inc. The next step will be our application to the TSX for preliminary approval for the new listing. The record date for shareholders will be determined in the future as we gain approvals and progress the financing of Capitan Mining.

While the COVID-19 health crisis initially slowed our financing process for Capitan Mining Inc., we are now resuming our fundraising efforts and given the renewed interest in the precious metals sector we are confident that we will make solid progress in the coming weeks. The raise for Capitan will provide sufficient funds to carry forward with resource expansion, further refinement of high-grade silver and gold zones, metallurgical studies and testing satellite targets. Once the financing of Capitan is complete and as we make it past the COVID-19 isolation stages and begin to work again, we will complete the drill permitting in Durango State, Mexico, with the environmental office that had to close due to COVID-19 restriction. Once their office is open again we will submit our already completed drill permit application for the Peñoles Project. 

The upside potential for Capitan is very promising indeed. Capitan Mining’s Peñoles Project has a gold resource of 300K ounces gold and 15M ounces silver and over 11,500 metres of past drilling. We believe this project’s resource has the potential for rapid expansion with the planned drill program. Existing drill holes at the Peñoles Project are quite shallow which allows for immediate expansion by continuations along strike and at depth. The access is excellent, and we already have more than 80 drill holes defining the near-surface resources, with the system still wide open for expansion.  In the coming months Riverside will announce the timing for the cut off of the Capitan Mining shares and then when they will be distributed to Riverside shareholders.

What is Riverside’s Cash Position?

Our shareholders have also asked if Riverside is in need of short-term financing and we are pleased to say, no! We are in a healthy financial position with over $2M cash in the bank, and will be receiving an additional $1.5M of funding from BHP for 2020 and into 2021, which allows us to maintain a healthy value creation program. This should allow us to continue executing on our plans and make positive progress with results and news flow to come.

What’s happening with RRIs Canada Portfolio?

Some shareholders have asked about our Canada program, which began in earnest late last year. You will recall that Riverside made the strategic decision to expand its portfolio of assets to include Canadian properties to diversify and provide our investors with exposure to more than one jurisdiction. Having Canadian assets in safe and stable jurisdictions such as Ontario expands the network of potential JV partners and allows for flow-through partner-funded spending on Riverside assets.

We are pleased to report that so far in Canada we have been lucky in being able to steer clear of the detrimental impacts of COVID-19. Mining and related activities have been maintained by the Province of Ontario as an “essential service”, and as such operational activities have been much less impacted when compared to other sectors. With the winter thaw well underway, we are starting to make preparations for site visits to these projects with potential partners, albeit while remaining vigilant about restrictions on movements and physical distancing measures. As such, we have made contingency plans for alternate ways in which we can advance these projects even while doing so with such restrictions in place. Our team has been able to work up reports and analyze data sets which aid us in making strong 3D visualizations, virtual imagery of the data with better interpretations and work with the extensive datasets we have on our properties.

In sum, the second half of 2020 is looking very promising for Riverside and Capitan. We have strong positive momentum on a number of fronts including the share price and a healthy cash position from which to work from. Our spin out of Capitan Mining is progressing swiftly and our Canadian projects are well situated to start adding value to the Riverside portfolio. Our other Mexico programs are continuing with our funding sponsor BHP and the Los Cuarentas gold district is starting to yield more newsworthy results. As I mentioned at the beginning of this letter, despite the constraints brought on by COVID-19, Riverside has made progress on many business fronts as we continue our commitment to a strong prospect generator business model of owning excellent assets with a high discovery potential.

Should you have any specific questions or comments/suggestions, we are available via phone or email to communicate with you. Additionally, we are also working with virtual conference formats to update investors through online video presentations. A recent interview with world traveler gold expert Byron King was posted this week following another recent interview we completed with a key supporter of ours, Rick Rule. I welcome you to click here to watch the interview with myself and Byron King.

Until the next update, I wish you and your families well, for safety, and continued good health.

Sincerely,

John-Mark Staude (President & CEO)