SILVER MINES LIMITED — Capital/Financing Update 2020

May 26, 2020

Level 11, 52 Phillip St Sydney NSW 2000 P: +61 2 8316 3997 F: +61 2 8316 3999 Info@silvermines.com.au www.silvermines.com.au

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27 May 2020

Company Announcement Officer ASX Limited Exchange Centre 20 Bridge Street SYDNEY NSW 2000

STRONG SUPPORT IN $12 MILLION CAPITAL RAISE

Silver Mines Limited (ASX:SVL) (“Silver Mines” or “the Company”) is pleased to advise that it has successfully completed a capital raising of A$12 million (before costs) (“Placement”) to institutional, professional and sophisticated investors.

The Placement was conducted at an issue price of $0.10 per share. The Placement will result in the issue of 120,000,000 fully paid, ordinary shares (“Shares”) which will be predominately issued using the Company’s capacity under ASX Listing Rule 7.1 and 7.1A. Related parties of the Company subscribed for 500,000 Shares and the issue of these Shares will be subject to shareholder approval. The Shares will rank equally with the Company’s fully paid, ordinary shares currently on issue.

Canaccord Genuity (Australia) Limited acted as the Sole Lead Manager to the Placement.

Silver Mines’ Managing Director, Mr Anthony McClure said “The Company is delighted with the outstanding response to the capital raising, it is a clear backing of our quality assets. The very positive outlook in precious metals including silver is also most encouraging.”

The funds raised under the Placement will be primarily used for the pre-development progression of the Company’s flagship Bowdens Silver Mine. Exploration activities over the coming 12 months will include extensional drilling at Bowdens Silver and exploration drilling at the Barabolar Project. Initial drilling at the Company’s Tuena Gold Project will also be scheduled in the coming months. Funding will also be made available for land acquisitions and for corporate and general working capital purposes.

The Placement was undertaken in the following portions:

• (a) Listing Rule 7.1: 95,825,093 Shares;

• (b) Listing Rule 7.1A: 23,674,907 Shares; and

• (c) 500,000 Shares were subscribed for by related parties of the Company which are subject to shareholder approval at the Company’s next general meeting at a date yet to be determined.

Settlement of the Placement is expected to take place on 2[nd] June 2020. The expected date of quotation of the Placement is 3[rd] June 2020.

The Company requests that the halt on trading in its securities be lifted with immediate effect.

Silver Mines Limited

ABN: 45 107 452 942

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This document has been authorised for release to the ASX by the Company’s Managing Director, Mr Anthony McClure.

Yours faithfully Silver Mines Limited

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Trent Franklin Company Secretary

Silver Mines Limited

ABN: 45 107 452 942

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