Mr. Shawn Howarth reports

EXCELLON SECURES PATH TO ACQUIRE THE PAST PRODUCING MALLAY SILVER MINE

A definitive agreement has been executed between Adar Mining Corp. and Premier Silver Corp. relating to the acquisition by Excellon Resources Inc. of Minera CRC SAC, which holds the past-producing Mallay silver mine and Tres Cerros exploration property in Peru.

Under the terms of the agreement, Excellon is acquiring the shares of Minera CRC through an expedited, court-supervised process, ensuring a legally definitive resolution of all prior disputes. Upon completion, Excellon will receive full ownership of Minera CRC free and clear of all encumbrances, as per the transaction terms previously announced on Oct. 31, 2024.

Announcement highlights:

• The Adar and Premier agreement -- definitively resolves any outstanding disputes, ensuring a clear legal process for the transfer of Minera CRC, without further timing risks or delays;
• Reinforces asset transfer -- Premier Silver has committed to selling 100 per cent of the shares of Minera CRC under an expedited, court-supervised process;
• Timing -- Excellon expects to close the acquisition of Minera CRC in April, 2025;
• Restart planning -- work is now under way to update the historic resource model for Mallay, incorporating higher silver and base metal prices; the updated resource model will form the basis of detailed mine scheduling and planning for restart;
• Exploration -- Excellon to provide update on recent surface prospecting completed at Tres Cerros, a greenfield, bulk-tonnage gold-silver epithermal target, 5.8 kilometres northwest of the Mallay mine;
• Capital raise -- discussions under way with potential offtakers and equity financing partners to secure restart financing, in the form of equity and other non-dilutive sources of capital.

Shawn Howarth, president and chief executive officer of Excellon, commented: "Today's announcement provides certainty in our acquisition of the past-producing Mallay mine, previously operated by Buenaventura. We are executing on an aggressive plan to return to silver production at Mallay in Q4 2025 and this agreement ensures an expedited closing with the full support of all stakeholders, allowing us to focus on unlocking value from the property."

Mr. Howarth added: "An operational team is already in place in Peru, Mallay is fully permitted, and our plan leverages the historic $115-million (U.S.) invested in mill and surface infrastructure and kilometres of underground mine development. We will immediately begin the restart process after closing and aim to return Excellon to producer status on an accelerated timeline."

Details of the Adar and Premier agreement

Premier has agreed to sell the shares of Minera CRC to Excellon through a court-supervised sale process conducted under Canadian insolvency law. The transaction will proceed through a proposal proceeding under the Bankruptcy and Insolvency Act (Canada), ensuring a transparent and orderly transition of ownership. As part of the settlement agreement, Premier Silver will receive $400,000 in Excellon shares, priced at the value of Excellon shares based on a five-day volume-weighted average price (VWAP), on the close of the acquisition.

Update to terms of the acquisition agreement between Excellon and Adar

Excellon and Adar have amended the definitive agreement announced Oct. 31, 2024, to provide for: (i) an increase of the upfront cash payments payable to Adar to $1,565,000 (U.S.) (from $1.25-million (U.S.)), with any portion of such upfront payments that is not spent by Adar prior to closing of the acquisition continuing to remain with Minera CRC; (ii) an increase of the termination fee payable by Adar to Excellon to $3.1-million (U.S.) (from $2.5-million (U.S.)) in the event that Excellon does not acquire the shares of Minera CRC in the bankruptcy proceedings and Adar receives repayment of indebtedness owed to Adar by the parent company of Minera CRC; and (iii) an extension of the outside date to complete the acquisition to April 29, 2025, which may be extended by 30 days by Excellon and up to four additional times through Excellon making a cash payment in the amount of $250,000 (U.S.) to Adar for each such 30-day extension.

Please refer to Excellon's news release dated Oct. 31, 2024, for a description of other terms and conditions related to the acquisition agreement.

About Mallay

The Mallay mine is a past-producing silver mine, fully permitted to restart production. Mallay was built and operated by Buenaventura from 2012 to 2018, with $115-million (U.S.) of historical investment. The mine went into care and maintenance in 2018 due to low silver prices (approximately $16 (U.S.) per ounce) and a change in strategic priorities at Buenaventura. Annual production by Buenaventura (2013 to 2017) averaged 1.3 million ounces of silver, 9,100 tonnes of zinc and 6,500 tonnes of lead.

The Tres Cerros project is a highly prospective gold-silver exploration project approximately five kilometres northwest of the Mallay mine. The project's prime area of interest is a 2.5-kilometre-by-500-metre corridor of gold-silver mineralization and coincident induced polarization/resistivity anomalies, indicative of a bulk-tonnage, high-sulphidation epithermal system. Numerous historical grab samples were taken across the 2.5-kilometre fault, which are being analyzed to determine further follow-up exploration work.

Further details on the Mallay mine and the Tres Cerros project are provided in the news release announcing the acquisition.

About Excellon Resources Inc.

Excellon's vision is to realize opportunities through the acquisition of advanced development or producing assets with further potential to gain from an experienced management team for the benefit of the company's employees, communities and shareholders. Excellon is in the process of acquiring the past-producing Mallay silver mine and Tres Cerros exploration project in Peru. The company is also advancing a portfolio of gold, silver and base metal assets, including Kilgore, an advanced gold exploration project in Idaho; and Silver City, a high-grade epithermal silver district in Saxony, Germany, with 750 years of mining history and little modern exploration.

Qualified person

Paul Keller, chief operating officer of Excellon and a qualified person within the meaning of National Instrument 43-101, Standards of Disclosure for Mineral Projects, has reviewed and approved the scientific and technical information in this news release.

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