AbraSilver Resource Corp. — Capital/Financing Update 2022

Dec 9, 2022

FORM 51-102F3

MATERIAL CHANGE REPORT

1. Name and Address of Company

AbraSilver Resource Corp. (the “ Corporation ”) 220 Bay Street, Suite 550 Toronto, ON M5J 2W4

2. Date of Material Change

November 29, 2022

3. News Release

A news release was issued on November 29, 2022 and was disseminated through the facilities of recognized newswire services. A copy of the press release was filed on SEDAR at www.sedar.com.

4. Summary of Material Change

On November 29, 2022, the Corporation entered into an engagement letter agreement with Eight Capital, as lead underwriter and bookrunner, and on behalf of a syndicate of underwriters (collectively, the “ Underwriters ”) in connection with a “bought deal” private placement financing (the “ Offering ”) of 21,622,000 units (the “ Units ”) at a price of $0.37 per Unit (the “ Issue Price ”) for gross proceeds of $21,800,140. Each Unit consists of one common share of the Corporation (each, a " Common Share ") and one-half of one Common Share purchase warrant (each whole warrant, a " Warrant "), with each Warrant entitling the holder thereof to purchase one additional Common Share at a price of $0.50 per Common Share for a period of 24 months following the closing of the Offering (the “ Closing Date ”).

The Corporation also granted the Underwriters an option, exercisable in whole or in part up to 48 hours prior to the Closing Date, to offer and sell up to an additional 5,405,000 Units at the Issue Price, for additional gross proceeds of up to $1,999,850 (the “ Underwriters’ Option ”).

The Offering closed on December 6, 2022 for aggregate gross proceeds of $9,999,990 (including the exercise in full of the Underwriters’ Option).

5.

Full Description of Material Change

On November 29, 2022, the Corporation entered into an engagement letter agreement with Eight Capital, as lead underwriter and bookrunner, and on behalf of the Underwriters in connection with a “bought deal” private placement financing of 21,622,000 Units at the Issue Price for gross proceeds of $21,800,140. Each Unit consists of one Common Share and one-half of one Warrant, with each Warrant entitling the holder thereof to purchase one additional Common Share at a price of $0.50 per Common Share for a period of 24 months following the Closing Date.

The Corporation also granted the Underwriters the Underwriters’ Option which was exercised in full on December 2, 2022.

The Offering closed on December 6, 2022 for aggregate gross proceeds to the Corporation of $9,999,990 (including the exercise in full of the Underwriters’ Option).

The Warrants were issued pursuant to the terms of a warrant indenture dated December 6, 2022 (the “ Warrant Indenture ”) entered into between the Corporation and TSX Trust Company. The full terms ascribed to the Warrants are set out in the Warrant Indenture, which is available under the Corporation’s profile on SEDAR at www.sedar.com.

In connection with the Offering, the Underwriters received an aggregate cash commission in the amount of approximately $565,000 and an aggregate of 1,527,075 non-transferrable broker warrants (each a “ Broker Warrant ”). Each Broker Warrant entitles the holder thereof to acquire one Unit at the Issue Price until June 6, 2024.

Certain directors of the Corporation participated in the Offering and purchased an aggregate of 190,000 Units. The insider participation in the Offering constitutes a related party transaction pursuant to Multilateral Instrument 61-101 – Protection of Minority Security Holders in Special Transactions (“ MI 61-101 ”). The Corporation has relied on exemptions from the formal valuation and minority shareholder approval requirements of MI 61-101 contained in sections 5.5(a) and 5.7(1)(a) of MI 61- 101 in respect of related party participation in the Offering as neither the fair market value (as determined under MI 61-101) of the subject matter of, nor the fair market value of the consideration for, the transaction, insofar as it involved related parties, exceeded 25% of the Corporation’s market capitalization as determined under MI 61-101. There has not been a material change in the percentage of the outstanding securities of the Corporation that are individually owned by any of the insiders who participated in the Offering as a result of their participation in the Offering. The Corporation obtained unanimous approval by the board of directors of the Corporation to complete the Offering. No materially contrary view or abstention was expressed or made by any director of the Corporation in relation thereto. The Corporation did not file a material change report related to the Offering more than 21 days before the expected closing of the Offering as the details of the insider participation were settled shortly prior to the closing of the Offering.

The Offering was completed pursuant to the Listed Issuer Financing Exemption (as defined in National Instrument 45-106 – Prospectus Exemptions ), and the securities issued to purchasers in the Offering are not subject to a hold period pursuant to applicable Canadian securities laws.

The Corporation intends to the use net proceeds of the Offering i) to complete the ongoing Phase III drilling program on the Diablillos Project in the Salta province of Argentina; (ii) to commence and complete a drilling program on the La Coipita Project in the San Juan province of Argentina; (iii) to satisfy the Corporation’s mineral interest commitments for the Diablillos Project and the La Coipita Project; and (iv) for working capital purposes, as further described in the Corporation’s offering document under the Listed Issuer Financing Exemption dated November 29, 2022, which was filed on SEDAR at www.sedar.com.

6. Reliance on subsection 7.1(2) of National Instrument 51-102

N/A

7. Omitted Information

No information has been omitted on the basis that it is confidential information.

8. Executive Officer

John Miniotis, the Chief Executive Officer of the Corporation, is knowledgeable about this material change report and may be contacted at info@abrasilver.com.

9. Date of Report

December 9, 2022

Cautionary Note Regarding Forward-Looking Information

This report includes certain “forward-looking statements” under applicable Canadian securities legislation, including statements related to the use of proceeds. Forward-looking statements are necessarily based upon a number of estimates and assumptions that, while considered reasonable, are subject to known and unknown risks, uncertainties, and other factors which may cause the actual results and future events to differ materially from those expressed or implied by such forward-looking statements. All statements that address future plans, activities, events or developments that the Corporation believes, expects or anticipates will or may occur are forward-looking information. There can be no assurance that such statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Accordingly, readers should not place undue reliance on forward-looking statements. When considering this forward-looking information, readers should keep in mind the risk factors and other cautionary statements in the Corporation’s disclosure documents filed with the applicable Canadian securities regulatory authorities on SEDAR at www.sedar.com. The risk factors and other factors noted in the disclosure documents could cause actual events or results to differ materially from those described in any forward-looking information. The Corporation disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law.