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The 2012 program holes were drilled vertically and intersections are estimated to be close to true width. These drill results combined with a series of holes reported earlier, have expanded and defined the extent of the Capire mineralization to the north and south while the zone remains open to the east.

Other Prospects in Capire Area

Drill results from the 2009 program on the Aurora II showing, located 1.3km southeast of the Capire minesite, were re-evaluated and a seven hole program is planned for 2013 to test the area immediately to the northeast. Mapping and sampling of the historical underground workings in the area suggest good potential for more extensive mineralization.

A prospecting program was undertaken in the Guadalupe Mamatla area, located 2.8km to the east of the Capire minesite, to determine the extent of the mineralization mapped in historical underground workings in preparation for a drill program that will be undertaken in early 2013.

ARCGIS DATABASE

Since 2007, the Company's exploration department has been constructing a state-of-the-art computer Geographic Information System (GIS) database capturing all relevant technical information for the Zacualpan and Mamatla Districts using ArcGIS software. At the core of this database is information pertaining to over 3,000 old mine workings and prospects representing almost 500 years of mining history in the districts. For several years the GIS database has been the main engine for generating and prioritizing new drill targets. In 2007 this database attained a critical mass of data such that it could be used to direct the drilling. At that time this database was used as simply a "viewer" of the data in much the same manner as a "light table". Nevertheless, a significant increase (31% to 61%) in the success rate IMPACT's exploration drilling in new areas was realized.

The year of 2011 represented another threshold year in the development of this GIS Database as different data sets were combined in an analytical and interpretive manner. This approach was further enhanced and expanded upon in 2012, and for the first time these enhanced data analysis methods were used to guide the drilling for the Company's exploration department. This resulted in yet another significant increase in the drilling success rate, not only in terms of finding intersections that exceeded the minimum metric but in finding many very high grade intersections that exceeded one kilogram per tonne silver (1,000 g/t Ag; see results above).

PLANS FOR 2013

Plans for 2013 are to move both Capire and Cuchara-Oscar into production during the first quarter and continue aggressive field work and drilling on targets in the Valle de Oro area and in the Capire Mine area. Additional drilling is also required for both the Condesa Silver area where the mineralization remains open to expansion at depth and to the southeast, and the Mirasol Central & Northwest areas where the mineralization is currently open in all directions. Additional fieldwork in the form of geological mapping and detailed rock sampling will continue in the Valle de Oro and the San Pablo Norte areas.

With a track record of successful exploration, rapid mine development and more than 3,000 old mine workings in the GIS database, IMPACT's long term growth strategy is to become a mid-tier multimillion ounce silver producer with multiple production centers each fed by multiple mines. The construction of a second production center at Capire is the next important step to fulfilling this vision. IMPACT's strong cash position and positive cash flow allows for accelerated growth through aggressive exploration and potential accretive acquisitions.