McFarlane Lake Mining Limited — Capital/Financing Update 2021

Dec 14, 2021

FORM 51-102F3 MATERIAL CHANGE REPORT

Item 1. Name and Address of Corporation

1287401 B.C. Ltd. (“ 401 ” or the “ Corporation ”) #1200 Waterfront Centre 200 Burrard Street Vancouver, British Columbia V6C 3L6

• Item 2.

Date of Material Change

December 9, 2021.

• Item 3. News Release

A news release was disseminated on December 10, 2021, through the System for Electronic Document Analysis and Retrieval (“ SEDAR ”)

• Item 4.

Summary of Material Change

On December 9, 2021, 401 and 1000034047 Ontario Inc. (“ Subco ”) closed the previously-announced non-brokered private placement offering (the " Offering ") of units in the capital of Subco (" Units ") by issuing 65,500 Units at a price of $0.40 each, for gross proceeds of approximately $26,200.

The Offering has been completed in connection with, and as a condition of, the previously announced business combination transaction (the " Proposed Transaction ") between 401, McFarlane Lake Mining Incorporated (“ McFarlane ”) and Subco, which is to occur by way of a plan of “three-cornered” amalgamation pursuant to a definitive business combination agreement and will result in the reverse takeover of 401 by McFarlane and the listing of the resulting entity (the " Resulting Issuer ") on the NEO Aequitas Exchange Inc.

Upon completion of the Proposed Transaction, the Resulting Issuer will carry on the current business of McFarlane.

Item 5. 5.1 Full Description of Material Change

On December 9, 2021, 401 and Subco closed the Offering by issuing 65,000 Units at a price of $0.40 each, for gross proceeds of approximately $26,200. Each Unit is comprised of one common share in the capital of Subco (“ Common Share ”) and one-half of one Common Share purchase warrant (“ Warrant ”). Each Warrant entitles the holder to purchase one Common Share for a period of 36 months from the date of issuance at an exercise price of $0.60.

The Offering has been completed in connection with, and as a condition of, the Proposed Transaction between 401, McFarlane and Subco, which is to occur by way of a plan of “three cornered” amalgamation pursuant to a definitive business combination agreement and will result in the reverse takeover of 401 by McFarlane and the listing of the Resulting Issuer on the NEO Aequitas Exchange Inc. Upon completion of the Proposed Transaction, the Resulting Issuer will carry on the current business of McFarlane.

The aggregate net proceeds of the Offering will be used to further the closing of the Proposed Transaction and for general corporate purposes. Although it is intended that the use of the net proceeds of the Offering will be as described herein, the actual allocation of proceeds may vary from the uses set forth herein, depending on future operations or unforeseen events or opportunities.

No commission, finder’s fee or similar payment (whether in the form of cash, securities or an interest in assets) was paid by the Corporation in connection with the Offering.

The Offering was approved by the Corporation’s board of directors and by Subco’s board of directors by means of a unanimous resolution.

5.2 Disclosure for Restructuring Transactions

Not applicable.

• Item 6. Reliance on Section 7.1(2) of National Instrument 51-102

Not applicable.

• Item 7. Omitted Information

No significant facts have been omitted from this report.

• Item 8. Executive Officer

James Ward Chief Executive Officer and Director (416) 897-2359

• Item 9. Date of Report

December 14, 2021

Cautionary Statement on Forward-Looking Statements and Information

This material change report contains “forward-looking information” and “forward-looking statements” (collectively, “forward-looking statements”) within the meaning of the applicable Canadian securities legislation. All statements, other than statements of historical fact, are forward-looking statements and are based on expectations, estimates and projections as at the date of this material change report. Any statement that involves discussions with respect to predictions, expectations, beliefs, plans, projections, objectives, assumptions, future events or performance (often but not always using phrases such as “expects”, or “does not expect”, “is expected”, “anticipates” or “does not anticipate”, “potential”, “plans”, “budget”, “scheduled”, “forecasts”, “estimates”, “believes” or “intends” or variations of such words and phrases or stating that certain actions, events or results “may” or “could”, “would” , “might “ or “will” be taken to occur or be achieved) are not statements of historical fact and may be forward-looking statements. In this material change report, forward-looking statements relate, among other things, to: (i) the proposal to complete the Proposed Transaction and associated transactions (ii) statements regarding the terms and conditions of the Proposed Transaction and the Offering; (iii) the use of proceeds from the Offering and the business and operations of 401, McFarlane, Subco and the Resulting Issuer; and (iv) approval of regulatory bodies. 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. Such factors include, but are not limited to: general business, economic, competitive, political and social uncertainties; the delay or failure to receive board, shareholder, court or regulatory approvals; the supply and demand for labour and other project inputs; changes in commodity prices; changes in interest and currency exchange rates; risks relating to inaccurate geological and engineering

assumptions; risks relating to unanticipated operational difficulties (including failure of equipment or processes to operate in accordance with specifications or expectations, cost escalation, unavailability of materials and equipment, government action or delays in the receipt of government approvals, industrial disturbances or other job action, and unanticipated events related to health, safety and environmental matters); risks relating to adverse weather conditions; political risk and social unrest; changes in general economic conditions or conditions in the financial markets; changes in laws; risks related to the direct and indirect impact of COVID-19 including, but not limited to, its impact on general economic conditions, and the ability to obtain financing as required; and other risk factors as detailed from time to time. 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 the forward-looking statements and information contained in this material change report. Except as required by law, 401 and Subco assume no obligation to update the forwardlooking statements of beliefs, opinions, projections, or other factors, should they change, except as required by law. The statements in this material change report are made as of the date of this material change report.