Sun Valley Gold LLC: Control and Direction Over Subscription Receipts of Klondex Mines Ltd.

SUN VALLEY, IDAHO--(Marketwired - Jan 15, 2014) - Sun Valley Gold LLC ("Sun Valley") announced today that it has acquired control and direction over 6,551,800 subscription receipts ("Subscription Receipts") of Klondex Mines Ltd. ("Klondex") on behalf of client accounts over which Sun Valley has discretionary trading authority. The Subscription Receipts were acquired pursuant to a private placement by Klondex of a total of 29,400,000 Subscription Receipts for a subscription price of $1.45 per Subscription Receipt (the "Offering"). Subject to adjustment in certain circumstances, each Subscription Receipt entitles the holder to receive, upon conversion, one common share of Klondex (a "Common Share") for no additional consideration. Subscription Receipts will be converted into Common Shares upon (i) completion of the proposed acquisition by Klondex of the Midas mine and milling facility and (ii) shareholder approval of the Offering (the "Escrow Conditions"). If the Escrow Conditions are not satisfied by February 28, 2014, the subscription proceeds will be returned to Sun Valley and the Subscription Receipts will be cancelled.

Following completion of the Offering, Sun Valley exercises control and direction over 6,551,800 Subscription Receipts and 8,700,000 Common Shares for and on behalf of client accounts. Upon conversion, the 6,551,800 Subscription Receipts over which Sun Valley exercises control and direction will, together with the 8,700,000 Common Shares over which Sun Valley exercises control and direction, represent approximately 13.97% of the issued and outstanding Common Shares (after giving effect to the automatic conversion of all Subscription Receipts issued pursuant to the Offering).

The securities of Klondex were acquired for investment purposes. Sun Valley may increase or decrease its ownership of securities of Klondex depending upon future market conditions.

FOR FURTHER INFORMATION, OR TO OBTAIN A COPY OF THE EARLY WARNING REPORT FILED BY SUN VALLEY UNDER APPLICABLE SECURITIES LEGISLATION, PLEASE SEE THE CONTACT INFORMATION BELOW.