Arizona seeks to reassure holders about Au, Ag prices

Mar 1, 2019

2019-02-28 19:16 ET – Shareholders Letter

Mr. Greg Hahn reports

LETTER

Dear shareholders,

Thanks to the timing of our new property acquisition, I can finally talk about Arizona Silver Exploration. Here we are at the end of a long bear metals market and hopefully we have turned the corner and are now heading into a long-awaited bull market. Everyone has been affected by market uncertainty and economic stress. With the recent rise in both gold and silver prices, perhaps people are looking for safe havens and history proven investments as the world figures things out. I do see more and more analysts turning to safe investments in these times of unrest, and gold and silver continue to lead in this department.

On February 13, 2019 we raised a small amount of capital $296,917 in an oversubscribed round of financing and once again insiders bought in. This is the 4th raise and each time management has participated and in one case over 50% was taken down by your management team, showing commitment and belief in our projects. This puts management at roughly 30% ownership of Arizona Silver Exploration. Including friends and family associates that number moves closer to 55% of the total shares outstanding of 34,469,154. Insiders also have 1,345,231 shares which are still escrowed for another year. This raise was done without warrants for the 4rd time now, once again demonstrating commitment to you, the shareholders. For those that are curious about this, let me explain. Most companies that offer warrants in financings are faced with selling once the 4-month hold comes due and as a result, people ride the warrant. In our case, if people sell, they are out and the structure remains as is, with no overhang of warrants being converted, increasing the share structure. We continue to be mindful of expenditures and budgets as you may have noticed in our recent financials. We have this thought in mind at all times as it is shareholders money, “NOT” ours. We have made adjustments to our team with two new Directors this year, Scott Hean and Gene Spiering, who have added value in their respective areas of expertise, and have taken positions in the company with share ownership as well.

I am happy to relay that Greg met with the US Forest Service on Dec 19, 2018 for the second time on site, hopefully advancing the approval process. We now await announcement of the final permit so we can see what lies below the surface of Sycamore Canyon. We have taken 98 samples to date (channel, chip, and core), and all have returned with good grades over a 600 x 100 meter area, see web site link: http://arizonasilverexploration.com/sycamore/

Our latest acquisition is a source of great anticipation. The Philadelphia property claim group has been on Greg’s radar for a long period of time and with patience we have come to a fantastic agreement. Philadelphia is a past producer in the Oatman Gold Mining District, and we believe the area has untapped potential, see link to interview https://youtu.be/UDdfZj8U2kw for Greg’s perspective. We have claimed over 2 Kilometers of strike on the vein target, or 280 acres, in order to protect future development possibilities. We are awaiting results for samples taken from various areas within our claims. The drilling permit for a 5- or 6-hole program is in process, as mentioned in the interview with Proactive above.

Highlights of Philadelphia Property

Past production indicates gold grades ranged from 3-0.79 opt (10-27 gpt) Au

Historic silver grades in production shaft average 12.25 opt (420 gpt) Ag

Historic gold grades in production shaft average 0.341 opt (15.5 gpt) Au, for a combined gold equivalent grade of 0.485 opt (16.63 gpt) Au(eq).

Readily accessible – initial drilling will be conducted less than 100 metres from paved road access.

Water will be provided from a water well on site

Samples have been taken on new targets on the 280 acres with results expected shortly

Drill permitting is underway with the US BLM and the State of Arizona

Planning for the next 4 months include attending PDAC March 2nd to 6th with scheduled meetings already in place. If you are attending feel free to reach out to my number below and perhaps we can meet. Once permits are issued on either Philadelphia or Sycamore, maiden drilling will take place immediately. If permits arrive at Sycamore first, we will drill there and then come back to Philadelphia or vise versa. This will give results from two projects over the course of several months. To date, we have hit 18 times on Ramsey, but Ramsey is a silver property with no gold. With gold and silver being the subject of our newest properties, we should see increased interest in Arizona Silver Exploration, especially as commodity prices increase ($ 15.80 silver and $ 1,325.00 gold respectively now).

We would like to thank all of you for staying the course with Arizona Silver Exploration. We have a very exciting 2019 planned. Look forward to news releases on a regular basis now with three properties. Management is committed to making 2019 a wonderful year for all shareholders!

Greg Hahn, President and CEO and a Certified Professional Geologist (#7122) is the Qualified Person under NI43-101 responsible for preparing and reviewing the historical data contained in this letter.

http://arizonasilverexploration.com/news-releases/