Subsequent to Q1 2019, the Mine Safety and Health Administration (“MSHA”) completed a routine inspection at the Florida Canyon Mine.

As a result of the inspection, a portion of the mining fleet was taken out of service to address deficiencies with respect to fluid leaks present on the equipment.

The Company voluntarily removed the majority of the fleet from service to address similar issues and ensure a safe operating standard on all equipment. Mine production continues to be negatively affected as a result of the mechanical down time. Crushing activity has also been negatively affected resulting in a reduction of the ore tonnes processed. As at May 7, 2019, Florida Canyon continues to experience low availability of the mining equipment and the Company is currently working to rectify the problem.

As a result, production for Q2 2019 will also be negatively affected. The Company is actively pursuing alternatives to improve the outlook.