Mr. Graham Hill reports

SILVER BEAR ANNOUNCES CLOSING OF PRIVATE PLACEMENT OF NON-CONVERTIBLE NOTE AND PROVIDES CORPORATE UPDATE

Silver Bear Resources Inc. has closed the previously announced private placement of a non-convertible promissory note by issuing a non-convertible promissory note in the principal amount of $3.3-million to one of the company's major shareholders, Inflection Management Corp.

Silver Bear's chief executive officer, Graham Hill, commented: "We are very pleased to complete this transaction, and are also appreciative to have such supportive shareholders that allow the company to maintain its development momentum, while negotiating our final project financing options. At this time the accelerated construction and mine plan for the Vertikalny deposit is progressing well, and we are confident that the company is in the position to meet its target of commissioning silver production by the second half of 2016."

The company sought and obtained minority and disinterested shareholder approvals at a special meeting of the company held on Jan. 11, 2016, for the issuance of the Inflection note as required by Multilateral Instrument 61-101 -- protection of minority security holders in special transactions and the TSX company manual. The Inflection note bears interest at a rate of 15 per cent per annum until its maturity on Dec. 31, 2016, and is non-convertible. The private placement was conducted on a non-brokered basis. No fee is payable by the company in respect of the issuance of securities under the private placement.

At the special meeting, the company also obtained minority and disinterested shareholder approvals, as required under MI 61-101 and the manual, for the payment of interest on and conversion into common shares of the corporation of certain consolidated contingent convertible notes in the aggregate principal amounts of $12,350,769.86 and $5,669,806.85 previously issued by the company to Inflection and A.B. Aterra Resources Ltd., respectively, on Dec. 4, 2015. The consolidated contingent convertible notes will now bear interest at a rate of 15 per cent per annum and mature on Dec. 31, 2016. All interest accrued under the consolidated contingent convertible notes will be convertible into common shares on the same terms as the principal amount.

For details of the private placement and the consolidated contingent convertible notes, please see Silver Bear's management information circular dated Dec. 7, 2015, and Silver Bear's press release dated Dec. 4, 2015, both of which have been filed on the company's profile on SEDAR.

Corporate update

In addition, the company has provided an update with respect to the developments of its Mangazeisky silver project located in Yakutia, Russia. Recent financing activities continue to support the company's procurement activity in 2016, building on the infrastructural construction and development work that was completed on site during the 2015 field season. Along with the orders for vital long-lead equipment announced in the second half of 2015, the company recently placed and confirmed contracts and orders, to meet its winter road delivery objectives, for:

• Two additional mining front end loaders to support the existing fleet;
• Primary and secondary crushing and screening plant which will also help with production of aggregates for civil works;
• Fabricated plant building steelwork;
• Complete set of leach tanks and agitators with supporting steelwork;
• Main power generation plant;
• Plant motor control centres and associated switchgear;
• Additional 1,000-cubic-metre fuel storage facility;
• Tailings thickener and flocculent mixing facility;
• Complete reagent mixing and storage facility.

Work on the project development is proceeding according to plan, with the team maintaining the very tight scheduled. The company is also expecting the first delivery of the ball mill components in Vladivostok, Russia, mid-January for deliver to site by early winter convoys. Currently the company and its subsidiary ZAO Prognoz are working closely with the detailed planning for logistics, mobilization of materials and contractors along with construction planning for the 2016 project development.

Planning of continuing exploration work based on the successful results obtained in 2015, and focused on both upgrading of existing mineral resources and the development of new mineral resources is well advanced with new drill rigs and greater productivity anticipated.

Chairman changes

Further to the company's announcement on July 20, 2015, regarding certain forthcoming chairman changes, effective Jan. 12, 2016, Christopher Westdal, an independent director of Silver Bear, has been appointed non-executive chairman of the company. Mr. Westdal replaces Robin Birchall who has resigned as executive chairman to devote more time to his other business interests. Mr. Birchall will remain on the board of directors of the company.

Mr. Birchall commented: "Over my tenure as executive chairman, I have worked tirelessly to ensure the advancement of Silver Bear and it is with some sadness that I step down due to the pressures of my other projects. I would like thank the whole Silver Bear team for their hard work this past year, in particular with regards to the advancement of the Mangazeisky silver project, which is a credit to our new president and CEO, Graham Hill, and the operating team in Yakutia, Russia. Under Graham's leadership, the company has made significant progress in a short period of time, and I believe the company is now in a strong operational position to pursue the goal of mine development and commissioning by the second half of 2016."

We seek Safe Harbor.