Apollo Silver Corp. — Regulatory Filings 2021

Jul 13, 2021

FORM 51-102F3 MATERIAL CHANGE REPORT

1. Name and Address of Company

Apollo Gold & Silver Corp. Suite 1507, 1030 West Georgia Street Vancouver, British Columbia V6E 2Y3

2. Date of Material Changes

July 6, 2021, July 8, 2021, and July 12, 2021

3. News Release

News releases with respect to the material changes described herein were issued by Apollo Gold & Silver Corp. (“ Apollo ” or the “ Company ) on July 7, 2021, July 9, 2021, and July 13, 2021 through the facilities of Globenewswire and filed on the System for Electronic Document Analysis and Retrieval (SEDAR).

4. Summary of Material Changes

On July 7, 2021, the Company announced that it completed its previously announced concurrent financing (the “ Concurrent Financing ”) of subscription Receipts (the “ Subscription Receipts ”). The Company issued a total of 70,533,334 Subscription Receipts for aggregate gross proceeds of $52,900,000.50.

On July 8, 2021, the Company announced that it converted the Subscription Receipts, closed the amalgamation transaction (the “ Transaction ”) and acquired all of the issued and outstanding shares of privately held Stronghold Silver Corp. (“ Stronghold ”).

On July 13, 2021, the Company announced the completion of the acquisition (the “ Acquisition ”) of a 100% interest in the Waterloo Silver-Barite Project (the “ Waterloo Project ”) from Pan American Minerals Inc., a wholly-owned subsidiary of Pan American Silver Corp. (“ Pan American ”).

In conjunction with the closing of the Acquisition, Cathy Fitzgerald, P. Geo, was appointed Vice President Exploration and Resource Development of the Company. Dean Besserer, has resigned from his role as Vice President, Exploration and will remain with the Company as a key technical advisor.

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5. Full Description of Material Changes

Concurrent Financing

On July 7, 2021, the Company announced the completion of the Concurrent Financing pursuant to which the Company issued a total of 70,533,334 Subscription Receipts for aggregate gross proceeds of $52,900,000.50.

Eight Capital, Desjardins Securities Inc. (“ Desjardins ”) and Cantor Fitzgerald Canada Corporation (together with Eight Capital and Desjardins, the “ Agents ”) acted as co-lead agents and joint bookrunners in connection with the Concurrent Financing. In connection with the Concurrent Financing, the Agents received an aggregate cash fee equal to 6.0% of the gross proceeds from any subscriptions, except in respect of subscriptions by purchasers on the President’s List, on which the Agents received a cash commission equal to 3.0% of the gross proceeds from such sale.

Upon satisfaction of certain escrow release conditions on July 8, 2021, each Subscription Receipt was automatically converted, without any further action by the holder of such Subscription Receipt (and for no additional consideration), into one unit of the Company (a “ Unit ”). Each Unit consisted of one common share of the Company (a “ Common Share ”) and one-half of one common share purchase warrant (each full warrant, a “ Warran t”). Each Warrant entitles the holder thereof to acquire one common share of the Company (each, a “ Warrant Share ”) at a price of $1.25 per Warrant Share for period of 24 months from the date of issuance.

The Company used a portion of the net proceeds from the Concurrent Financing to complete the Transaction and the Acquisition. The remaining proceeds from the Concurrent Financing, together with the Company’s existing treasury of approximately $5,000,000, will be used as follows: (1) $7.2M for exploration and resource development work at the Calico Silver project; (2) $0.5M for option payments and mineral title taxes; (3) $1.5M for exploration at the Arizona Silver Project; (4) $5.1M in general and administrative costs; and (5) $6.9 M for general corporate and business development activities.

The Subscription Receipts were issued pursuant to a subscription receipt agreement dated July 6, 2021 (the “ Subscription Receipt Agreement ”) among the Company, the Agents, and Endeavor Trust Corporation as subscription receipt agent. Pursuant to the Subscription Receipt Agreement, the gross proceeds from the Concurrent Financing (net 50% of the cash commission payable to the Agents and the reasonable costs and expenses of the Agents and their counsel) (the “ Net Escrowed Funds ”) were deposited in escrow. The Net Escrowed Funds were released from escrow to the Company immediately prior to the closing of the Transaction upon the satisfaction of specified escrow release conditions as set out in the Subscription Receipt Agreement.

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The Transaction

On July 8, 2021, the Company announced that it closed the amalgamation transaction with Stronghold. Apollo, through its 100% owned Stronghold subsidiary, now holds rights to three large scale silver projects: Waterloo and Langtry in California and The Silver District in Arizona. With the closing of the Transaction Apollo has become a leading US focused silver exploration and development company.

With the close of the Transaction, Apollo has issued a total of 40,000,000 Common Shares to Stronghold shareholders at a share exchange ratio of one Apollo Common Share for one Stronghold common share or warrant (the “ Exchange Ratio ”). The Common Shares issued by Apollo to Stronghold shareholders are subject to various seed share resale restrictions imposed by the TSX Venture Exchange. Apollo will also be assuming 5,010,638 warrants of Stronghold (the “ Stronghold Warrants ”). The Stronghold Warrants will now, in accordance with their terms, be exercisable into Common Shares of Apollo at an exercise price of US$0.20 per Stronghold Warrant. James Hynes, the former CEO of Stronghold, has been appointed as a director of the Company effective on the closing of the Transaction.

The Acquisition of the Waterloo Project

On July 13, 2021, the Company announced the acquisition of the Waterloo Project from Pan American Minerals Inc., a wholly-owned subsidiary of Pan American.

Stronghold (an indirect wholly owned subsidiary of the Company) as purchaser, and Pan American, as vendor, entered into an asset purchase agreement dated January 22, 2021 (the “ Waterloo Purchase Agreement ”) which gave Stronghold the right to purchase a 100% interest in the Waterloo Project for a consideration of US$25,000,000 (the “ Base Purchase Price ”).

All conditions required by the asset purchase agreement were successfully met and the Waterloo Project, including patented mining claims, unpatented mining claims and mill sites, fee land interests, and all easements and right of way, if any, related thereto and all improvements, fixtures and appurtenances existing thereon or forming part thereof have been transferred to Stronghold. In addition, all Waterloo Project documents, including all data related to the Waterloo Project in the possession of the Pan American, have become the property of Stronghold.

Pan American will retain a 2% Net Smelter Royalty on any future production of minerals from the Waterloo Project. In addition, within 15 days of the close of the Acquisition, Apollo will issue to Pan American notice providing Pan American with ten business days to elect to receive either: 1) an additional US$6,000,000 in cash, or 2) the equivalent of US$6,000,000 in Common Shares of Apollo at the higher of: (i) the 10-day VWAP calculated 10 trading days following the close of the Acquisition; and (ii) CA$0.71 per Common Share.

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In conjunction with the closing of the Acquisition, Cathy Fitzgerald, P. Geo, was appointed Vice President Exploration and Resource Development of the Company. Dean Besserer, has resigned from his role as Vice President, Exploration and will remain with the Company as a key technical advisor.

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

Confidentiality is not requested.

7. Omitted Information

Not applicable.

8. Executive Officer

For further information contact Tom Peregoodoff, Chief Executive Officer at the abovementioned address or by telephone at 604 428 6128.

9. Date of Report

July 13, 2021.

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