Mr. Andre van Niekerk reports

GATOS SILVER PROVIDES BI-WEEKLY STATUS REPORT

Gatos Silver Inc. is providing this biweekly default status report in accordance with National Policy 12-203 (Management Cease Trade Orders). In its March 18, 2022, news release, the company announced the delay in the filing of its annual report on Form 10-K for the year ended Dec. 31, 2021, which includes its audited consolidated financial statements as at and for the year ended Dec. 31, 2021, together with the auditor's report thereon and the notes thereto, its management's discussion and analysis for the year ended Dec. 31, 2021, relating to the audited annual financial statements, and the chief executive officer and chief financial officer certificates relating to its annual filings by the filing deadline of March 31, 2022. In its May 13, 2022, news release, the company announced the delay in the filing of its interim financial filings on Form 10-Q for the quarterly period ended March 31, 2022, which includes interim financial statements as at and for the quarterly period ended March 31, 2022, together with its management's discussion and analysis for the quarterly period ended March 31, 2022, relating to the interim financial statements, and the chief executive officer and chief financial officer certificates relating to its interim filings by the filing deadline of May 16, 2022. In its Aug. 5, 2022, news release, the company announced the delay in filing its interim financial filings on Form 10-Q for the quarterly and year-to-date periods ended June 30, 2022, which includes interim financial statements as at June 30, 2022, and for the quarterly and year-to-date periods ended June 30, 2022, together with its management's discussion and analysis for the quarterly period ended June 30, 2022, relating to the interim financial statements, and the chief executive officer and chief financial officer certificates relating to its interim filings by the filing deadline of Aug. 15, 2022. In its Nov. 11, 2022, news release, the company announced the delay in filing its interim financial filings on Form 10-Q for the quarterly and year-to-date periods ended Sept. 30, 2022, which includes interim financial statements as at Sept. 30, 2022, and for the quarterly and year-to-date periods ended Sept. 30, 2022, together with its management's discussion and analysis for the quarterly period ended Sept. 30, 2022, relating to the interim financial statements, and the chief executive officer and chief financial officer certificates relating to its interim filings by the filing deadline of Nov. 14, 2022.

On Nov. 14, 2022, the company announced the appointment of Ernst & Young LLP as the company's independent registered public accounting firm, effective immediately. EY will be auditing and reporting on the company's consolidated financial statements for the financial years ended Dec. 31, 2021, and Dec. 31, 2022, and will be reviewing the company's quarterly unaudited interim financial information for 2022. The company expects all delayed filings, including the audit of the financial statements required to be included in its annual report on Form 10-K for the year ended Dec. 31, 2021, and the reviews of its quarterly reports on Forms 10-Q for the quarters ended March 31, 2022, June 30, 2022, and Sept. 30, 2022, to be completed before the end of the first quarter of 2023. The company expects to hold its 2023 annual shareholders meeting later this year.

As previously disclosed, in connection with its continuing review of the mineral reserve reporting errors and its preparation of its 2021 annual financial statements and 2022 interim financial statements, the company has identified material weaknesses in its internal controls over financial reporting. The company has determined that the material weaknesses relate to its failures to design and maintain: (i) an effective control environment commensurate with the financial reporting requirements of a public company in the United States and Canada; and (ii) effective controls over the assessment of certain key assumptions, inputs and outputs contained in its 2020 technical report. The company is continuing to assess the impact of these material weaknesses and whether any other material weaknesses exist. On Jan. 9, 2023, the company engaged a third party expert to assist management in documenting key processes related to the company's internal control environment, designing and implementing an effective risk assessment and monitoring program to identify risks of material misstatements, and ensuring that the internal controls have been appropriately designed to address and effectively monitor identified risks. The company expects to provide additional information in its coming public reports.

A management cease trade order was granted by the Ontario Securities Commission on April 1, 2022, and the Ontario Securities Commission granted additional management cease trade orders on April 12, 2022, and July 7, 2022.

Pursuant to NP 12-203, the company must file biweekly status reports in the form of further news releases during the period from the notice until the MCTO is revoked. The company reports that since the notice: (i) there have been no material changes regarding the information contained in the notice that have not been disclosed in a biweekly default status report or in a news release referenced therein; (ii) there have been no failures by the company in fulfilling its stated intentions with respect to satisfying the provisions of the alternative information guidelines under NP 12-203; and (iii) there has not been any specified default subsequent to the defaults announced in the notice and the news releases dated May 13, 2022, Aug. 5, 2022, and Nov. 11, 2022.

About Gatos Silver Inc.

Gatos Silver is a silver-dominant exploration, development and production company that discovered a new silver- and zinc-rich mineral district in southern Chihuahua state, Mexico. As a 70-per-cent owner of Los Gatos joint venture (LGJV), the company is primarily focused on operating the Cerro Los Gatos mine and on growth and development of Los Gatos district. The LGJV consists of approximately 103,087 hectares of mineral rights, representing a highly prospective and underexplored district with numerous silver-zinc-lead epithermal mineralized zones identified as priority targets.

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