An anonymous director reports

SIERRA METALS AND ALPAYANA REACH AGREEMENT IN PRINCIPLE FOR CDN $1.15 ALL-CASH SUPPORTED TAKE-OVER BID AND EXTENDS OFFER

Sierra Metals Inc., Alpayana SAC and Alpayana Canada Ltd. have reached an agreement in principle for an all-cash, board-supported takeover bid, under which Alpayana Canada will make an offer to acquire all of the common shares of the company for cash consideration of $1.15 per common share.

The parties expect to enter into a support agreement for the supporting bid as soon as reasonably practicable, but, in any event, by April 30, 2025. The support agreement is expected to contain customary terms for the supporting bid, including the existing conditions of Alpayana's takeover bid offer.

The supporting bid has the unanimous support of the board of directors and the special committee of independent directors of Sierra Metals, and the board of directors will unanimously recommend that the shareholders of Sierra Metals tender their shares to the supporting bid. Sierra Metals' financial adviser, BMO Capital Markets, has provided an oral fairness opinion to the Sierra board that, as of April 22, 2025, and subject to the assumptions, limitations and qualifications on which such opinion is based, the consideration to be received under the supporting bid is fair, from a financial point of view, to the shareholders of Sierra Metals.

Following the execution of the support agreement, the Sierra board will issue an amended circular in connection with the supporting bid, setting forth the details of its recommendation and certain related matters. Alpayana will issue a notice of variation in connection with the supporting bid as well.

In addition, the directors and officers of Sierra Metals have agreed to enter into a lock-up agreement with Alpayana, under which they will agree to tender their common shares to the supporting bid.

Alpayana Canada has extended the expiry time in respect of the existing takeover bid until 5 p.m. ET on May 12, 2025, in order to provide the shareholders of Sierra Metals with sufficient time to tender their shares.

About Sierra Metals Inc.

Sierra Metals is a Canadian mining company focused on copper production with additional base and precious metals byproduct credits at its Yauricocha mine in Peru and Bolivar mine in Mexico. The company is intent on safely increasing production volume and growing mineral resources. Sierra Metals has recently had several new key discoveries and still has many more exciting brownfield exploration opportunities in Peru and Mexico that are within close proximity to the existing mines. Additionally, the company has large land packages at each of its mines with several prospective regional targets, providing longer-term exploration upside and mineral resource growth potential.

Advisers and counsel

Sierra Metals has retained BMO Capital Markets as financial adviser, Mintz LLP as legal counsel, and Carson Proxy Advisors as communications adviser. The special committee has engaged Bennett Jones LLP as its legal adviser.

Alpayana has retained LXG Capital as financial adviser and McCarthy Tetrault LLP, Estudio Rebaza, Alcazar & De las Casas, and Creel, Garcia-Cuellar, Aiza y Enriquez Abogados as legal counsel to this transaction.

We seek Safe Harbor.