Mr. Eric Caba reports

BEAR CREEK MINING CLOSES RESTRUCTURING TRANSACTION WITH SANDSTORM TO IMPROVE NEAR TERM CASH FLOW

Bear Creek Mining Corp. has closed its previously announced restructuring transaction with Sandstorm Gold Ltd. and its subsidiaries, which was effected by way of a restructuring framework agreement dated Sept. 28, 2023. The transaction is expected to improve the company's ability to produce free cash flow in the near term from the Mercedes mines via (i) a 325-ounce-per-month reduction in near-term gold stream deliveries and the complete suspension of silver stream delivery obligations until April, 2028, and (ii) the refinancing and extension of Bear Creek's debt with Sandstorm. For more information regarding the transaction, please see the company's news releases dated Sept. 28, 2023, and Nov. 24, 2023.

Eric Caba, president and chief executive officer of Bear Creek, states: "The restructuring agreement is a significant part of our strategy to improve the impact of Mercedes on Bear Creek's financial condition and, by extension, its value to shareholders. The restructuring agreement significantly reduces the company's near-term debt liabilities and its monthly debt repayment contributions, and increases the company's participation in the sale of gold and silver produced at the mine through lower stream obligations. Together, these benefits improve the ability of Mercedes to generate positive cash flow that can be deployed on reinvesting in growth initiatives at Mercedes and on advancing our cornerstone Corani project in Peru."

Stream amendments

In accordance with the restructuring agreement, the company and Sandstorm have amended: (i) the gold purchase agreement between the parties originally dated Dec. 16, 2021, and (ii) the purchase and sale agreement dated April 21, 2022, between the company and a wholly owned subsidiary of Sandstorm (the Nomad stream and collectively with the Sandstorm Gold stream, the stream amendments). As a result of the stream amendments, the company is now obliged to deliver to Sandstorm 275 ounces of gold per month until April, 2028 (previously 600 ounces per month until May, 2026). In addition, silver deliveries are suspended through April, 2028 (previously 25,000 ounces per month). In combination with the conclusion on Sept. 27, 2023, of a second gold stream on Mercedes (see Bear Creek news release dated Sept. 28, 2023), the stream amendments are expected to reduce the monthly stream burden at Mercedes by 78 per cent. Furthermore, under the stream amendments, cash payments for streamed ounces increase to 25 per cent of spot price on all gold (fixed and tail) and silver deliveries (from 7.5 per cent on fixed gold deliveries and 20 per cent on all silver deliveries).

As consideration for the stream amendments, the company issued the following consideration to Sandstorm:

1. 28,767,399 common shares of the company to Sandstorm at a deemed value of 27 cents per common share for an aggregate value of approximately $7,767,198 or $5,751,350 (U.S.) (such issuance of common shares brings Sandstorm's ownership interest in the company to approximately 19.99 per cent of the outstanding common shares);
2. Granted Sandstorm a 1.0-per-cent net smelter returns royalty (the royalty agreement) on and over the Corani property;
3. Increased the principal amount of the Sandstorm promissory note (as defined herein) by $4,248,650.33 (U.S.) (the consideration shortfall).

Debt restructuring

Pursuant to the restructuring agreement, the company amended the principal terms of the convertible debenture dated Dec. 16, 2021 (the original convertible debenture), between the company and Sandstorm (the amended convertible debenture) such that: (i) the maturity date was extended to Sept. 22, 2028, (ii) the interest rate of 6.0 per cent was amended to 7.0 per cent, and (iii) the conversion price of $1.51 per common share was amended to 73 cents per common share, such that the principal amount of $22.5-million (U.S.) may be converted, in whole or in part and at Sandstorm's election, into approximately 41,625,000 common shares (subject to exchange rate fluctuations), provided that a conversion of principal to common shares under the amended convertible debenture may not cause Sandstorm's ownership interest in the company to exceed 19.99 per cent. All other material terms and conditions of the amended convertible debenture will be substantially similar to the original convertible debenture.

Pursuant to the transaction, the company refinanced a $14,373,000 (U.S.) promissory note (the Sandstorm secured loan) issued by the company to an affiliate of Sandstorm, by entering into a new amended and restated secured promissory note with a principal amount equal to up to $21,642,612.35 (U.S.). Such principal amount comprises (i) $14,768,962 (U.S.), being the current principal and accrued interest owing under the Sandstorm secured loan (including $5,373,000 (U.S.) advanced between Sept. 30, 2023, and the closing of the restructuring agreement); and (ii) $4,248,650.33 (U.S.), being the consideration shortfall. The Sandstorm promissory note shares substantially the same maturity date and conversion terms as the amended convertible debenture herein.

Sandstorm files early warning report

Pursuant to National Instrument 62-103 -- The Early Warning System and Related Take Over Bid and Insider Reporting Issues, Sandstorm is announcing the receipt of 28,767,399 consideration shares of the company pursuant to the transaction. The acquisition of the consideration shares represents approximately 12.6 per cent of the outstanding common shares following closing of the transaction on a non-diluted basis.

Prior to Bear Creek's issuance of the consideration shares, Sandstorm held 16,725,000 common shares, representing approximately 8.4 per cent of the outstanding common shares on a non-diluted basis. Upon completion of the transaction, an aggregate of 45,492,399 common shares are owned by Sandstorm, representing 19.99 per cent of the common shares on a non-diluted basis. Pursuant to the amended convertible debenture and Sandstorm promissory note, Sandstorm is entitled to acquire up to an additional 81,663,833 common shares (subject to exchange rate fluctuations). Accordingly, if all convertible securities held by Sandstorm are converted in accordance with their terms it would result in Sandstorm holding 127,156,232 common shares (subject to exchange rate fluctuations) equal to approximately 41.1 per cent of the then issued and outstanding common shares (on a partially diluted basis). However, the convertible securities held by Sandstorm are subject to a conversion limitation such that a conversion of principal to common shares under both the amended convertible debenture and the Sandstorm promissory note may not result in Sandstorm having beneficial ownership over common shares in excess of 19.99 per cent.

As noted herein, the consideration shares were acquired pursuant to the restructuring agreement. The acquisition of the consideration shares was effected for investment purposes. Sandstorm may from time to time acquire additional securities of Bear Creek, dispose of some or all of the existing or additional securities it holds (or will hold), or may continue to hold its current position. An early warning report, as required under National Instrument 62-103, contains additional information with respect to the foregoing matters and will be filed by Sandstorm on Bear Creek's SEDAR+ profile.

Sandstorm is a non-arm's-length party (as such term is defined in TSX Venture Exchange Policy 1.1 -- Interpretation) in relation to the company. The transactions disclosed in this news release including the restructuring agreement and the transactions under the restructuring agreement, including the stream amendments, the consideration shares, the royalty agreement, the amended convertible debenture, and the Sandstorm promissory note are subject to final approval from the TSX-V.

About Bear Creek Mining Corp.

Bear Creek Mining is a precious metals producer with a world-class development asset. The company's Mercedes mine in Sonora, Mexico, is a cash-flow-generating gold mine with operational upside and exciting exploration potential. The company's Corani silver-polymetallic deposit in Puno, Peru, is one of the largest fully permitted silver deposits in the world and is highlighted by its substantial reserves and resources, low estimated operating costs, and overwhelming community support.

We seek Safe Harbor.