UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 6-K

REPORT OF FOREIGN PRIVATE ISSUER

PURSUANT TO RULE 13a-16 OR 15d-16

OF THE SECURITIES EXCHANGE ACT OF 1934

For the month of May 2024

Commission File Number:001-41225

VIZSLA SILVER CORP.

(Registrant)

Suite 1723, 595 Burrard Street

Vancouver, British Columbia V7X 1J1 Canada

(Address of Principal Executive Offices)

Indicate by check mark whether the Registrant files or will file annual reports under cover of Form 20-F or Form 40-F.

Form 20-F  ☐            Form 40-F  ☒

Indicate by check mark if the Registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1):  ☐

Indicate by check mark if the Registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7):  ☐

 

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

 

VIZSLA SILVER CORP.

 

(Registrant)

 

 

 

Date: May 22, 2024

By

/s/ Michael Konnert

 

 

Michael Konnert

 

 

Chief Executive Officer



EXHIBIT INDEX

 

 

Exhibit

Description of Exhibit

 

 

99.1 Notice of Meeting
99.2 Information Circular
99.3 Form of Proxy
99.4 Letter of Transmittal

99.5

Abridgement Certificate




VIZSLA SILVER CORP.

NOTICE OF SPECIAL MEETING OF SHAREHOLDERS

NOTICE IS HEREBY GIVEN that the special meeting (the "Meeting") of the holders of common shares ("Shareholders") of Vizsla Silver Corp. (the "Company") will be held at 555 Burrard Street, 11th Floor, Suite 1165, Vancouver, British Columbia V7X 1M8, on June 17, 2024, at 10:00 a.m. (Vancouver time):

At the Meeting, Shareholders will be asked to consider the following matters:

1. to consider and, if deemed appropriate, to pass, with or without variation, a special resolution of the Shareholders (the "Arrangement Resolution"), the full text of which is attached as Schedule "A" to the Circular for a statutory arrangement (the "Arrangement") under section 288 of the Business Corporations Act (British Columbia) which involves, among other things, the distribution of common shares and common share purchase warrants of Vizsla Royalties Corp. ("Spinco") to shareholders of the Company on the basis of 1/3 of a Spinco common share and 1/3 of a Spinco common share purchase warrant for each common share of the Company held on the effective date of the Arrangement. The warrants and options of the Company will also be adjusted pursuant to the Arrangement as described in more detail in the enclosed management information circular (the "Circular");

2. subject to the approval of the Arrangement Resolution, to consider and, if thought fit, approve, with or without amendment, an ordinary resolution to approve a stock option plan for Spinco, as more fully described in the Circular; and

3. to transact such other business as may properly come before the Meeting or any adjournment thereof.

The specific details of these matters to be put before the Meeting are set forth in the Circular accompanying this notice. Copies of the Arrangement Resolution, the plan of arrangement, the interim order and notice of hearing for the final order are attached to the Circular as Schedules "A", "C", "D" and "E", respectively. The board of directors of the Company have approved the contents of the Circular and the distribution of the Circular to Shareholders. All Shareholders are reminded to review the Circular before voting. Registered Shareholders have a right of dissent in respect of the proposed arrangement and to be paid the fair value of their Vizsla Silver Shares of the Company. The dissent rights are described in the accompanying Circular and are attached to the Circular as Schedule "F". Failure to strictly comply with the required procedures may result in the loss of any right of dissent.

You have the right to vote if you were a Shareholder of the Company at the close of business on May 13, 2024, the record date set by the board of directors of the Company for determining the Shareholders entitled to receive notice of and vote at the Meeting or any adjournment(s) or postponement(s) thereof.

If you are unable to attend the Meeting, you are encouraged to vote your proxy by mail, internet or telephone. To be effective, the enclosed proxy form must be returned to the Company's transfer agent, Computershare Investor Services Inc.:

(a) by mail using the enclosed return envelope;

(b) by internet or telephone as described on the enclosed proxy; or

(c) by registered mail, by hand or by courier delivery to Computershare Investor Services Inc., 100 University Ave., 8th Floor, Toronto, ON M5J 2Y1.

All instructions are listed on the enclosed form of proxy. Your proxy or voting instructions must be received in each case no later than 10:00 a.m. (Vancouver Time) on June 13, 2024, or, if the Meeting is adjourned, at least 48 hours (excluding Saturdays, Sundays and statutory holidays in the Province of British Columbia or Ontario) before the beginning of any adjournment to the Meeting.


If you are a non-registered beneficial shareholder, a voting information form (also known as a "VIF"), instead of a form of proxy, may be enclosed. You must follow the instructions provided by your Intermediary in order to vote your shares.

If you have any questions relating to the Meeting or require assistance with voting, please contact Laurel Hill Advisory Group North America (Toll Free): 1-877-452-7184 (Outside North America: 1-416-304-0211) or email: assistance@laurelhill.com.

DATED at Vancouver, British Columbia this 17th day of May, 2024.

BY ORDER OF THE BOARD OF DIRECTORS

"Michael Konnert"

Michael Konnert

President, Chief Executive Officer, and Director



 

 

SPECIAL MEETING OF SHAREHOLDERS

TO BE HELD ON JUNE 17, 2024

 

NOTICE OF SPECIAL MEETING AND

MANAGEMENT INFORMATION CIRCULAR

with respect to a proposed

PLAN OF ARRANGEMENT

May 17, 2024

Questions or requests for voting assistance may also be directed to Vizsla Silver Corp.'s proxy solicitation agent:

Laurel Hill Advisory Group

North America Toll Free:

1-877-452-7184

Collect Calls Outside North America:

1-416-304-0211

Email:

assistance@laurelhill.com

VIZSLA SILVER CORP.



LETTER TO SHAREHOLDERS

Dear fellow Shareholders,

On behalf of the Board of Directors ("Board") of Vizsla Silver Corp. ("Vizsla Silver" or the "Company"), I would like to invite you to attend the special meeting (the "Meeting") of the holders of common shares of the Company (the "Shareholders") to be held at 555 Burrard Street, 11th Floor, Suite 1165, Vancouver, British Columbia V7X 1M8, at 10:00 a.m. (Vancouver time) on June 17, 2024. Many of Vizsla Silver's directors and executives will be at the meeting and available to answer your questions. We will be voting on matters related to the spinout of Vizsla Royalties Corp. ("Spinco") from the Company, as described further in this Information Circular ("Circular").

Benefits

The Spinout will provide long-term option value for Shareholders. Spinco will provide Shareholders with the opportunity to participate in the future success of the Panuco Project. The Board is recommending the Arrangement and believes it enhances the long-term prospects for both Vizsla Silver and Spinco and provides a number of benefits to Shareholders, including, among others:

 providing Shareholders with enhanced value by creating independent investment opportunities in a silver- focused company and royalty company;

 enabling investors, analysts and other stakeholders or potential stakeholders to more accurately evaluate each company and compare the assets to appropriate peers;

 providing each company with a sharper business focus, enabling them to pursue independent business and financing strategies best suited to their respective business plans;

 enabling each company to pursue independent growth and capital allocation strategies; and

 allowing each company to be led by experienced executives and directors who have experience exploring resource properties and building and operating mines.

Your feedback and your vote are important to us, and we have ensured that voting is easy and accessible. You can vote in person or by proxy at the Meeting, and by proxy on the internet, by phone, or by mail. If you are a Registered Vizsla Silver Shareholder and are unable to attend the Meeting in person, we encourage you to vote by completing the enclosed proxy. If you are a Non-Registered Holder of Vizsla Silver shares and have received this letter and the Circular from your broker or another Intermediary, please complete and return the proxy or the voting instruction form provided to you in accordance with the instructions.

At the Meeting, Shareholders will be asked to, among other things, pass a special resolution approving a statutory plan of arrangement (the "Arrangement") whereby Vizsla Silver will spin out certain assets, including a royalty on Vizsla Silver's Panuco Project in southern Sinaloa, Mexico held by Spinco. The Arrangement involves, among other things, the distribution of common shares (the "Spinco Shares") and common share purchase warrants (the "Spinco Warrants") of Spinco to existing Vizsla Silver Shareholders such that each Shareholder will hold: (i) one new common share of the Company ("New Vizsla Silver Share") for each common share of the Company ("Vizsla Silver Share") held on the effective date of the Arrangement; (ii) 1/3 of a Spinco Share for every Vizsla Silver Share held on the effective date of the Arrangement; and (iii) 1/3 of a Spinco Warrant for every Vizsla Silver Share held on the effective date of the Arrangement. Warrants and options of the Company will also be adjusted pursuant to the Arrangement as described in more detail in the enclosed Circular. On completion of the Arrangement, Vizsla Silver is expected to hold approximately 55% of the outstanding Spinco Shares.

After careful consideration, the Board has unanimously determined that the Arrangement is in the best interests of the Company. A description of the various factors considered by the Board in arriving at this determination is contained in the enclosed Circular. The Board has unanimously approved the Arrangement and recommends that Shareholders vote in favour of the special resolution approving the Arrangement.


To be effective, the Arrangement must be approved by a special resolution passed by at least 66⅔% of the votes cast by Shareholders present in person or represented by proxy at the Meeting, which Shareholders are entitled to one vote for each Vizsla Silver Share held. The Arrangement is not subject to the minority approval requirements of MI 61-101. At the Meeting, in addition to the approval of the Arrangement, we will ask Shareholders to approve a stock option plan for Spinco.

If you have any questions about the information contained in the Circular or require assistance in completing the proxy, please contact Laurel Hill Advisory Group North America (Toll Free): 1-877-452-7184 (Outside North America: 1-416-304-0211) or email: assistance@laurelhill.com. If you have any questions about Vizsla Silver's business strategy, please contact the Company by telephone at (604) 364-2215 or by e-mail at info@vizslasilver.ca. We are always available to answer your questions.

Thank you for your support and your confidence in Vizsla Silver.

Sincerely,

"Michael A. Konnert"

Michael A. Konnert

President, Chief Executive Officer, and Director

       
Voting Methods 

     
  Internet Telephone or Fax Mail
Registered Vote online at Telephone: 1-866-732-8683 Return the form of
Shareholders www.investorvote.com Fax: 1-866-249-7775 proxy in the
Shares held in own name     enclosed postage
and represented by a     paid envelope.
physical certificate.      
Non Registered Vote online at Call or fax to the number(s) Return the voting
Shareholders www.proxyvote.com listed on your voting instruction form in
Shares held with a   instruction form. the enclosed
broker, bank or other     postage paid
intermediary.     envelope.
       



TABLE OF CONTENTS

NOTICE TO READERS  4
   
INFORMATION FOR U.S. SHAREHOLDERS  4
   
FORWARD-LOOKING INFORMATION  6
   
TECHNICAL INFORMATION 8
   
GLOSSARY OF DEFINED TERMS  8
   
QUESTIONS AND ANSWERS  15

SUMMARY  1
   
GENERAL VOTING INFORMATION  5
   
VOTING SECURITIES AND PRINCIPAL HOLDERS OF VOTING SECURITIES  8
   
INTEREST OF CERTAIN PERSONS OR COMPANIES IN MATTERS TO BE ACTED UPON  8
   
PARTICULARS OF MATTERS TO BE ACTED UPON  8
   
MANAGEMENT CONTRACTS 9
   
INTEREST OF INFORMED PERSONS IN MATERIAL TRANSACTIONS  9
   
THE ARRANGEMENT  9
   
DISSENT RIGHTS  18
   
CERTAIN SECURITIES LAW MATTERS 20
   
MATERIAL INCOME TAX CONSIDERATIONS  22
   
INFORMATION CONCERNING SPINCO POST-ARRANGEMENT 35
   
INFORMATION CONCERNING VIZSLA SILVER POST-ARRANGEMENT  35
   
ADDITIONAL INFORMATION 35
   
OTHER BUSINESS  35
   
APPROVAL OF BOARD  35

SCHEDULES    
A - Arrangement Resolution A-1
B - Option Plan Resolution B-1
C - Arrangement Agreement C-1
D - Interim Order D-1
E - Notice of Hearing for Final Order E-1
F - Statutory Dissent Provisions F-1
G - Spinco Following the Arrangement G-1
H - Spinco Audit Committee Charter H-1
I - Spinco Financial Statements and Related MD&A I-1
J - Spinco Pro Forma Financial Statements J-1
K - Spinco Stock Option Plan K-1
L - Vizsla Silver Following the Arrangement L-1
M - Vizsla Silver Financial Statements and Related MD&A M-1


VIZSLA SILVER CORP.

NOTICE OF SPECIAL MEETING OF SHAREHOLDERS

NOTICE IS HEREBY GIVEN that the special meeting (the "Meeting") of the holders of common shares ("Shareholders") of Vizsla Silver Corp. (the "Company") will be held at 555 Burrard Street, 11th Floor, Suite 1165, Vancouver, British Columbia V7X 1M8, on June 17, 2024, at 10:00 a.m. (Vancouver time):

At the Meeting, Shareholders will be asked to consider the following matters:

1. to consider and, if deemed appropriate, to pass, with or without variation, a special resolution of the Shareholders (the "Arrangement Resolution"), the full text of which is attached as Schedule "A" to the Circular for a statutory arrangement (the "Arrangement") under section 288 of the Business Corporations Act (British Columbia) which involves, among other things, the distribution of common shares and common share purchase warrants of Vizsla Royalties Corp. ("Spinco") to shareholders of the Company on the basis of 1/3 of a Spinco common share and 1/3 of a Spinco common share purchase warrant for each common share of the Company held on the effective date of the Arrangement. The warrants and options of the Company will also be adjusted pursuant to the Arrangement as described in more detail in the enclosed management information circular (the "Circular");

2. subject to the approval of the Arrangement Resolution, to consider and, if thought fit, approve, with or without amendment, an ordinary resolution to approve a stock option plan for Spinco, as more fully described in the Circular; and

3. to transact such other business as may properly come before the Meeting or any adjournment thereof.

The specific details of these matters to be put before the Meeting are set forth in the Circular accompanying this notice. Copies of the Arrangement Resolution, the plan of arrangement, the interim order and notice of hearing for the final order are attached to the Circular as Schedules "A", "C", "D" and "E", respectively. The board of directors of the Company have approved the contents of the Circular and the distribution of the Circular to Shareholders. All Shareholders are reminded to review the Circular before voting. Registered Shareholders have a right of dissent in respect of the proposed arrangement and to be paid the fair value of their Vizsla Silver Shares of the Company. The dissent rights are described in the accompanying Circular and are attached to the Circular as Schedule "F". Failure to strictly comply with the required procedures may result in the loss of any right of dissent.

You have the right to vote if you were a Shareholder of the Company at the close of business on May 13, 2024, the record date set by the board of directors of the Company for determining the Shareholders entitled to receive notice of and vote at the Meeting or any adjournment(s) or postponement(s) thereof.

If you are unable to attend the Meeting, you are encouraged to vote your proxy by mail, internet or telephone. To be effective, the enclosed proxy form must be returned to the Company's transfer agent, Computershare Investor Services Inc.:

(a) by mail using the enclosed return envelope;

(b) by internet or telephone as described on the enclosed proxy; or

(c) by registered mail, by hand or by courier delivery to Computershare Investor Services Inc., 100 University Ave., 8th Floor, Toronto, ON M5J 2Y1.

All instructions are listed on the enclosed form of proxy. Your proxy or voting instructions must be received in each case no later than 10:00 a.m. (Vancouver Time) on June 13, 2024, or, if the Meeting is adjourned, at least 48 hours (excluding Saturdays, Sundays and statutory holidays in the Province of British Columbia or Ontario) before the beginning of any adjournment to the Meeting.


If you are a non-registered beneficial shareholder, a voting information form (also known as a "VIF"), instead of a form of proxy, may be enclosed. You must follow the instructions provided by your Intermediary in order to vote your shares.

If you have any questions relating to the Meeting or require assistance with voting, please contact Laurel Hill Advisory Group North America (Toll Free): 1-877-452-7184 (Outside North America: 1-416-304-0211) or email: assistance@laurelhill.com.

DATED at Vancouver, British Columbia this 17th day of May, 2024.

BY ORDER OF THE BOARD OF DIRECTORS

"Michael Konnert"

Michael Konnert

President, Chief Executive Officer, and Director


NOTICE TO READERS

Vizsla Silver Corp. ("Vizsla Silver" or the "Company") is providing this Circular and a form of proxy in connection with management's solicitation of proxies for use at the Meeting of the Company to be held on June 17, 2024, and at any postponements or adjournments thereof. References in this Circular to the Meeting include any adjournment(s) or postponement(s) that may occur. Unless the context otherwise requires, references in this Circular to the Company include Vizsla Silver's subsidiaries. All capitalized terms used in this Circular (including the Schedules hereto) but not otherwise defined herein have the meanings set forth under "Glossary of Defined Terms".

In accordance with NI 54-101, arrangements have been made with brokerage houses and clearing agencies, custodians, nominees, fiduciaries or other intermediaries to forward the Company's proxy solicitation materials to the beneficial owners of the Vizsla Silver Shares held of record by such parties. The Company may reimburse such parties for reasonable fees and disbursements incurred by them in doing so.

The Circular provides additional information respecting the business of the Meeting, Vizsla Silver, Spinco and those companies' directors and senior executive officers. This Circular is dated May 17, 2024 and, unless otherwise stated, the information in this Circular is as of such date. The Company will conduct its solicitation by mail and officers and employees of the Company may, without receiving special compensation, also telephone or make other personal contact. The Company will pay the cost of solicitation.

All references to financial results are based on the Company's financial statements, prepared in accordance with International Financial Reporting Standards ("IFRS").

No person has been authorized to give any information or to make any representation in connection with the Arrangement and any other matters described herein other than those contained in this Circular and, if given or made, any such information or representation should not be considered to have been authorized by Vizsla Silver or Spinco.

This Circular does not constitute the solicitation of an offer to purchase, or the making of an offer to sell, any securities or the solicitation by proxy by any person in any jurisdiction in which such solicitation or offer is not authorized or in which the person making such solicitation or offer is not qualified to do so or to any person to whom it is unlawful to make such solicitation or offer.

INFORMATION FOR U.S. SHAREHOLDERS

THE ARRANGEMENT AND THE SECURITIES TO BE ISSUED IN CONNECTION WITH THE ARRANGEMENT HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE U.S. SECURITIES AND EXCHANGE COMMISSION OR SECURITIES REGULATORY AUTHORITIES IN ANY STATE IN THE UNITED STATES, NOR HAS THE U.S. SECURITIES AND EXCHANGE COMMISSION OR THE SECURITIES REGULATORY AUTHORITIES OF ANY STATE IN THE UNITED STATES PASSED UPON THE FAIRNESS OR MERITS OF THE ARRANGEMENT OR UPON THE ADEQUACY OR ACCURACY OF THIS CIRCULAR. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.

The New Vizsla Silver Shares, Spinco Shares and Spinco Warrants to be issued to Shareholders in the United States pursuant to the Arrangement described in this Circular have not been and will not be registered under the 1933 Act or any U.S. state securities laws, and are being issued and distributed, respectively, in reliance on the exemption from registration under the 1933 Act set forth in Section 3(a)(10) thereof and exemptions provided under the securities laws of any state of the United States in which the Shareholders reside. Section 3(a)(10) of the 1933 Act provides an exemption from registration under the 1933 Act for offers and sales of securities issued in exchange for one or more bona fide outstanding securities where the terms and conditions of the issuance and exchange of such securities have been approved by a court authorized to grant such approval after a hearing upon the fairness of the terms and conditions of the issuance and exchange at which all persons to whom the securities will be issued have the right to appear and receive timely notice thereof. The Court is authorized to conduct a hearing at which the fairness of the terms and conditions of the Arrangement will be considered. The Court issued the Interim Order on May 15, 2024 and, subject to the approval of the Arrangement by the Shareholders at the Meeting on June 17, 2024, it is expected that the hearing on the Arrangement will be held by the Court on June 19, 2024 at 9:45 am (Vancouver time) at the Law Courts, 800 Smithe Street, Vancouver, British Columbia. All Shareholders are entitled to appear and be heard at this hearing. The Final Order will constitute a basis for the exemption from the registration requirements of the 1933 Act provided by Section 3(a)(10) thereof with respect to the New Vizsla Silver Shares, Spinco Shares and Spinco Warrants to be issued pursuant to the Arrangement to Shareholders in the United States. Prior to the hearing on the Final Order, the Court will be informed of this effect of the Final Order. See "The Arrangement - Court Approval of the Arrangement" in this Circular.


The solicitation of proxies for the Meeting made pursuant to this Circular is not subject to the requirements applicable to proxy statements under the 1934 Act by virtue of an exemption applicable to foreign private issuers (as defined in Rule 3b-4 under the 1934 Act). The Spinco Shares and Spinco Warrants to be issued to Shareholders in the United States pursuant to the Arrangement described in this Circular will not be listed for trading on any U.S. stock exchange or registered under the 1934 Act. Accordingly, the solicitations and transactions contemplated in this Circular are made in the United States for securities of a Canadian issuer in accordance with Canadian corporate and securities laws, and this Circular has been prepared solely in accordance with disclosure requirements applicable in Canada. Shareholders in the United States should be aware that such requirements are different from those of the United States applicable to registration statements under the 1933 Act and proxy statements under the 1934 Act.

The financial statements and historical financial information included or incorporated by reference in this Circular have been prepared based upon IFRS and are subject to Canadian auditing standards and auditor independence standards and thus are not comparable in all respects to financial statements prepared in accordance with U.S. Generally Accepted Accounting Principles ("GAAP") and subject to standards of the Association of International Certified Professional Accountants. Likewise, information concerning the operations of Vizsla Silver and Spinco contained herein has been prepared based on IFRS disclosure standards, which are not comparable in all respects to U.S. disclosure standards.

The enforcement by investors of civil liabilities under U.S. securities laws may be adversely affected by the fact that Vizsla Silver and Spinco and certain of their respective subsidiaries are organized under the laws of jurisdictions outside the United States, that certain of their officers and directors are residents of countries other than the United States, that the experts named in this Circular are residents of countries other than the United States and that a significant portion of the assets of Vizsla Silver and Spinco and their respective subsidiaries and substantially all of the assets of certain such persons are located outside the United States. As a result, it may be difficult or impossible for Shareholders in the United States to effect service of process within the United States upon Vizsla Silver or Spinco, their respective officers or directors or the experts named herein, or to realize against them upon judgments of courts of the United States predicated upon civil liabilities under the federal securities laws of the United States or "blue sky" laws of any state within the United States. In addition, Shareholders in the United States should not assume that the courts of Canada: (a) would enforce judgments of U.S. courts obtained in actions against such persons predicated upon civil liabilities under the federal securities laws of the United States or "blue sky" laws of any state within the United States; or (b) would enforce, in original actions, liabilities against such persons predicated upon civil liabilities under the federal securities laws of the United States or "blue sky" laws of any state within the United States.

In addition, when used in respect of the projects in which Vizsla Silver or Spinco has an interest, the terms "mineral reserve" and "mineral resource" have been reported in accordance with Canadian reporting standards. Canadian reporting requirements for disclosure of mineral properties are governed by NI 43-101. U.S. reporting requirements are governed by the U.S. Securities and Exchange Commission ("SEC") Industry Guide 7 ("Guide 7"). The information included or incorporated by reference in this Circular includes estimates of the "mineral reserve" and "mineral resource" reported in accordance with NI 43-101. The reporting standards under NI 43-101 and Guide 7 are materially different. For example, under Guide 7, mineralization may not be classified as a "reserve" unless the determination has been made that the mineralization could be economically and legally produced or extracted at the time the reserve determination is made, which is not the case under NI 43-101. Consequently, the definitions of "proven mineral reserve" and "probable mineral reserve" under NI 43-101 differ in certain material respects from the standards of the SEC. In addition, Vizsla Silver and Spinco also report estimates of "mineral resource" in accordance with NI 43-101. While the terms "mineral resource", "measured mineral resource", "indicated mineral resource" and "inferred mineral resource" are recognized by NI 43-101, they are not recognized under the standards of the SEC. As a result, U.S. companies are generally not permitted to report estimates of "mineral resource" of any category in documents filed with the SEC. As such, certain information included in this Circular concerning descriptions of mineralization and estimates of "mineral reserve" and "mineral resource" reported in accordance with Canadian standards is not comparable to similar information made public by U.S. companies subject to the reporting and disclosure requirements of the SEC. Readers are cautioned not to assume that all or any part of a "measured mineral resource" or "indicated mineral resource" estimate will ever be converted into a "mineral reserve". Readers should also not assume that all or any part of a "mineral resource" will ever be upgraded to a higher category. In particular, an "inferred mineral resource" has a great amount of uncertainty as to its existence and as to its economic and legal feasibility and, under NI 43-101, an "inferred mineral resource" estimate may not form the basis of feasibility or other economic studies. Readers are, therefore, further cautioned not to assume that all or any part of an "inferred mineral resource" exists or is, or will ever be, economically or legally mineable.


The New Vizsla Silver Shares, Spinco Shares and Spinco Warrants to be issued to Shareholders in the United States pursuant to the Arrangement will generally be freely transferable under U.S. federal securities laws, except by persons who are "affiliates" (as such term is understood under U.S. securities laws) of Vizsla Silver and Spinco after the Effective Date, or were "affiliates" of Vizsla Silver and Spinco within 90 days prior to the Effective Date. Persons who may be deemed to be "affiliates" of an issuer include individuals or entities that control, are controlled by, or are under common control with, the issuer, whether through the ownership of voting securities, by contract, or otherwise, and generally include executive officers and directors of the issuer as well as principal shareholders of the issuer. Any resale of such securities by such an affiliate (or former affiliate) may be subject to the registration requirements of the 1933 Act, absent an exemption therefrom. See "Certain Securities Law Matters - U.S. Securities Laws".

The exemption from registration under Section 3(a)(10) of the 1933 Act does not exempt the issuance of securities upon the exercise of securities that were previously issued pursuant to such exemption. Therefore, the Spinco Shares issuable upon exercise of the Spinco Warrants may not be issued in reliance upon the exemption from registration under Section 3(a)(10) of the 1933 Act and the Spinco Warrants may only be exercised pursuant to an available exemption from the registration requirements of the 1933 Act and applicable state securities laws. Prior to the issuance of Spinco Shares pursuant to any such exercise after the Effective Time, Spinco may require evidence (which may include in an opinion of counsel) reasonably satisfactory to Spinco to the effect that the issuance of such securities do not require registration under the 1933 Act or applicable state securities laws. See "Certain Securities Law Matters - U.S. Securities Laws".

FORWARD-LOOKING INFORMATION

This Circular includes and incorporates statements that are prospective in nature that constitute forward looking information and/or forward-looking statements within the meaning of applicable securities laws (collectively, "forward-looking statements"). Forward-looking statements include, but are not limited to, statements concerning the completion and proposed terms of, and matters relating to, the Arrangement and the expected timing related thereto, the tax treatment of the Arrangement, the expected operations, financial results and condition of Vizsla Silver and Spinco following the Arrangement, each company's future objectives and strategies to achieve those objectives, the future prospects of each company as an independent company, the listing or continued listing of Vizsla Silver on the TSX Venture Exchange ("TSXV"), the future listing of Spinco on a stock exchange, any market created for either company's shares, the estimated cash flow, capitalization and adequacy thereof for each company following the Arrangement, the expected benefits of the Arrangement to, and resulting treatment of, Shareholders, holders of convertible securities and each company, the anticipated effects of the Arrangement, the fair market value of Spinco Shares and Spinco Warrants, the estimated costs of the Arrangement, the satisfaction of the conditions to consummate the Arrangement, the completion of the Post-Closing Steps and timing thereof; as well as other statements with respect to management's beliefs, plans, estimates and intentions, and similar statements concerning anticipated future events, results, circumstances, performance or expectations that are not historical facts. Forward-looking statements generally can be identified by the use of forward-looking terminology such as "outlook", "objective", "may", "will", "expect", "intend", "estimate", "anticipate", "believe", "should", "plans" or "continue", or similar expressions suggesting future outcomes or events.

Forward-looking statements reflect management's current beliefs, expectations and assumptions and are based on information currently available to management, management's historical experience, perception of trends and current business conditions, expected future developments and other factors which management considers appropriate. With respect to the forward-looking statements included in or incorporated into this Circular, we have made certain assumptions with respect to, among other things, the anticipated approval of the Arrangement by Shareholders and the Court, the anticipated receipt of any required regulatory approvals and consents, the expectation that each of Vizsla Silver and Spinco will comply with the terms and conditions of the Arrangement Agreement, the expectation that no event, change or other circumstance will occur that could give rise to the termination of the Arrangement Agreement, that no unforeseen changes in the legislative and operating framework for the respective businesses of Vizsla Silver and Spinco will occur, that each company will meet its future objectives and priorities, that each company will have access to adequate capital to fund its future projects and plans, that each company's future projects and plans will proceed as anticipated, as well as assumptions concerning general economic and industry growth rates, commodity prices, currency exchange and interest rates and competitive intensity.


Readers are cautioned not to place undue reliance on forward-looking statements, as there can be no assurance that the future circumstances, outcomes or results anticipated or implied by such forward-looking statements will occur or that plans, intentions or expectations upon which the forward-looking statements are based will occur. By their nature, forward-looking statements involve known and unknown risks and uncertainties and other factors that could cause actual results to differ materially from those contemplated by such statements. Factors that could cause such differences include, but are not limited to: conditions precedent or approvals required for the Arrangement not being obtained; the potential benefits of the Arrangement not being realized; the risk of tax liabilities as a result of the Arrangement, and general business and economic uncertainties and adverse market conditions; the potential for the trading price of New Vizsla Silver Shares (if any) after the Arrangement being less than the trading price of Vizsla Silver Shares immediately prior to the Arrangement; there being no concrete deadline to list Spinco Shares or Spinco Warrants on any stock exchange or that such listing will be successful; there being no established market for the Spinco Shares or Spinco Warrants; Spinco Shares or Spinco Warrants may not be "Qualified Investments" as defined in Canadian federal income tax law; Vizsla Silver's ability to delay or amend the implementation of all or part of the Arrangement or to proceed with the Arrangement even if certain consents and approvals are not obtained on a timely basis; the reduced diversity of Vizsla Silver and Spinco as separate companies; the costs related to the Arrangement that must be paid even if the Arrangement is not completed; obtaining approvals and consents, or satisfying other requirements, necessary or desirable to permit or facilitate completion of the Arrangement; global financial markets, general economic conditions, competitive business environments, and other factors that may negatively impact Vizsla Silver's financial condition; future factors that may arise making it inadvisable to proceed with, or advisable to delay, all or part of the Arrangement; and, the potential inability or unwillingness of current Shareholders to hold New Vizsla Silver Shares, Spinco Shares and/or Spinco Warrants following the Arrangement.

For a further description of these and other factors that could cause actual results to differ materially from the forward- looking statements included in or incorporated into this Circular, see the risk factors discussed under "The Arrangement - Risk Factors Relating to the Arrangement" in this Circular and under the heading "Risk Factors" in Schedules "G" and "L", as well as the risk factors included in Vizsla Silver's management's discussion and analysis for the year ended April 30, 2023 and for the interim period ended January 31, 2024 and as described from time to time in the reports and disclosure documents filed by Vizsla Silver with Canadian securities regulatory authorities, which are available under Vizsla Silver's profile on SEDAR+. This list is not exhaustive of the factors that may impact Vizsla Silver's forward-looking statements. These and other factors should be considered carefully and readers should not place undue reliance on Vizsla Silver's forward-looking statements. As a result of the foregoing and other factors, there can be no assurance that actual results will be consistent with these forward-looking statements.

All forward-looking statements included in or incorporated by reference into this Circular are qualified by these cautionary statements. The forward-looking statements contained herein are made as of the date of this Circular and, except as required by applicable law, neither Vizsla Silver nor Spinco undertakes any obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future events or otherwise.

Readers are cautioned that the actual results achieved will vary from the information provided herein and that such variations may be material. Consequently, there are no representations by Vizsla Silver or Spinco that actual results achieved will be the same in whole or in part as those set out in the forward-looking statements.


TECHNICAL INFORMATION

Jesus Velador, Ph.D. MMSA QP., Vice President of Exploration of Vizsla Silver, is a Qualified Person under NI 43- 101 and has approved the technical and scientific disclosure contained herein.

GLOSSARY OF DEFINED TERMS

The following is a glossary of certain terms used in this Circular, including the summary hereof and the Schedules to the Circular.

"1933 Act" means the U.S. Securities Act of 1933, as amended, and all rules and regulations thereunder.

"1934 Act" means the U.S. Securities Exchange Act of 1934, as amended, and all rules and regulations thereunder.

"2024 Canadian Federal Budget" has the meaning given to it under the heading "Material Canadian Federal Income Tax Considerations - Holders Resident in Canada - Taxation of Capital Gains and Capital Losses".

"ACB" has the meaning given to it under the heading "Material Canadian Federal Income Tax Considerations - Holders Resident in Canada - Exchange of Vizsla Silver Shares for New Vizsla Silver Shares, Spinco Shares and Spinco Warrants".

"allowable capital loss" has the meaning given to it under the heading "Material Canadian Federal Income Tax Considerations - Holders Resident in Canada - Taxation of Capital Gains and Capital Losses".

"Arrangement Agreement" means the arrangement agreement dated March 27, 2024 between Vizsla Silver and Spinco, a copy of which is attached as Schedule "C", as it may be amended or modified from time to time.

"Arrangement Resolution" means the special resolution to be considered by the Shareholders at the Meeting to approve the Arrangement, and which will be in, or substantially in, the form set out at Schedule "A".

"Arrangement" means the arrangement of Vizsla Silver under Section 288 of the BCBCA on the terms and subject to the conditions set out in the Plan of Arrangement, subject to any amendments or variations thereto made in accordance with the Plan of Arrangement or the Arrangement Agreement or made at the direction of the Court in the Final Order deemed acceptable to Vizsla Silver.

"Articles" means the articles of incorporation of Vizsla Silver.

"Audit Committee" has the meaning given to it under the heading "Audit Committee".

"BCBCA" means the Business Corporations Act (British Columbia), as amended.

"Board" or "Board of Directors" means the board of directors of Vizsla Silver, as constituted from time to time.

"Broadridge" means Broadridge Financial Solutions, Inc.

"Business Day" means a day which is not a Saturday, Sunday or statutory holiday in Vancouver, British Columbia, Canada.

"Circular" means this management information circular dated May 15, 2024, together with all schedules, appendices and exhibits hereto, as amended, supplemented or otherwise modified from time to time.

"Computershare" means Computershare Trust Company of Canada, at its offices in Vancouver, British Columbia, in its capacity as registrar and transfer agent of the Vizsla Silver Shares.

"Company" or "Vizsla Silver" means Vizsla Silver Corp., a corporation existing under the BCBCA.


"Consolidation" has the meaning given to it under the heading "Schedule G - Spinco Following the Arrangement - Consolidation".

"Controlling Individual" has the meaning given under the heading "Material Canadian Federal Income Tax Considerations - Holders Resident in Canada - Eligibility for Investment - New Vizsla Silver Shares, Spinco Shares and Spinco Warrants".

"Court" means the Supreme Court of British Columbia.

"CRA" means the Canada Revenue Agency.

"Depositary" means Computershare Investor Services Inc., or such other depositary as Vizsla Silver may determine.

"Dissent Procedures" has the meaning given to it under the heading "Dissent Rights".

"Dissent Rights" means the right of Registered Shareholders to exercise a right of dissent under the BCBCA in strict compliance with the Dissent Procedures.

"Dissent Shares" means the Vizsla Silver Shares held by Dissenting Shareholders in respect of which such Dissenting Shareholders have given Notice of Dissent.

"Dissenting Resident Holder" has the meaning given to it under the heading "Material Canadian Federal Income Tax Considerations - Holders Resident in Canada - Dissenting Resident Holder".

"Dissenting Shareholder" mean a Registered Shareholder who exercises Dissent Rights in respect of the Arrangement in strict compliance with the BCBCA, as modified or supplemented by the Interim Order, Plan of Arrangement or any other order(s) of the Court and who has not withdrawn or has been deemed to have withdrawn such exercise of such Dissent Rights.

"DPSP" means a deferred profit sharing plan.

"DRS" means Direct Registration System.

"Effective Date" means the effective date of the Arrangement, which will be two Business Days following the date on which all of the conditions precedent to the completion of the Arrangement have been satisfied or waived in accordance with the Arrangement Agreement (other than conditions which cannot, by their terms, be satisfied until the Effective Date, but subject to satisfaction or waiver of such conditions as of the Effective Date) or such other date as may be mutually agreed by Vizsla Silver and Spinco.

"Effective Time" means 12:01 a.m. (Vancouver time) on the Effective Date, or such other time on the Effective Date as may be mutually agreed by Vizsla Silver and Spinco.

"FHSA" means a first home savings account.

"Final Order" means the order made after application to the Court pursuant to section 291(4) of the BCBCA, after being informed of the intention to rely upon the exemption from registration under Section 3(a)(10) of the 1933 Act in connection with the issuance of the New Vizsla Silver Shares, Spinco Shares and Spinco Warrants under the Plan of Arrangement to Shareholders in the United States, in a form acceptable to the parties, each acting reasonably, after a hearing upon the procedural and substantive fairness of the terms and conditions of the Arrangement, approving the Arrangement, as such order may be amended by the Court (with the consent of the parties each acting reasonably) at any time prior to the Effective Date or, if appealed, then, unless such appeal is withdrawn or denied, as affirmed or as amended (provided that any such amendment is acceptable to the parties, each acting reasonably) on appeal.

"First Loan" has the meaning given to it under the heading "Schedule G - Spinco Following the Arrangement - Loans".


"First Loan Settlement" has the meaning given to it under the heading "Schedule G - Spinco Following the Arrangement - Loans".

"Frankfurt Exchange" means the Börse Frankfurt (Frankfurt Stock Exchange).

"Future Royalty Right" has the meaning given to it under the heading "Schedule G - Spinco Following the Arrangement - Future Royalty Right".

"Holder" has the meaning given to it under the heading "Material Income Tax Considerations - Material Canadian Federal Income Tax Considerations".

"IFRS" means international financial reporting standards as adopted by the International Accounting Standards Board from time to time.

"In the Money Amount" at a particular time with respect to an Vizsla Silver Option, Vizsla Silver Replacement Option or Spinco Option means the amount, if any, by which the fair market value of the underlying security exceeds the exercise price of the relevant option at such time.

"Interim Order" means the order made after application to the Court pursuant to section 291(2) of the BCBCA, after being informed of the intention to rely upon the exemption from registration under Section 3(a)(10) of the 1933 Act in connection with the issuance of the New Vizsla Silver Shares, Spinco Shares and Spinco Warrants under the Plan of Arrangement to Shareholders in the United States, in a form acceptable to the parties, each acting reasonably, providing for, among other things, the calling and holding of the Meeting, as such order may be amended by the Court with the consent of the parties, each acting reasonably, in respect of the Meeting and the Arrangement, a copy of which is attached as Schedule "E".

"Intermediary" means an intermediary with which a Non-Registered Shareholder may deal, including banks, trust companies, securities dealers or brokers and trustees or administrators of self-directed trusts governed by registered retirement savings plans, registered retirement income funds, registered education savings plans (each, as defined in the Tax Act) and similar plans, and their nominees.

"Investor Relations Activities" has the meaning assigned by Policy 1.1 of the TSXV policies.

"IRS" has the meaning given to it under the heading "Material Income Tax Considerations - Material United States Federal Income Tax Considerations".

"Laurel Hill" means Laurel Hill Advisory Group, in its capacity as the proxy solicitation agent of Vizsla Silver.

"Listing Date" means the date on which the Spinco Shares and Spinco Warrants are listed for trading on the TSXV.

"Management Designees" has the meaning given to it under the heading "General Voting Information - Appointment of Proxyholders and Completion and Revocation of Proxies".

"Meeting" means the special meeting of Shareholders to be held on June 17, 2024, and any adjournment(s) or postponement(s) thereof, held in order to, among other things, consider and, if thought fit, approve the Arrangement.

"MI 61-101" means Multilateral Instrument 61-101 - Protection of Minority Shareholders in Special Transactions.

"New Vizsla Silver Shares" means the new class of common shares without par value which Vizsla Silver will create and issue as described in section 3.1(b)(ii) of the Plan of Arrangement and for which the Vizsla Silver Class A Shares are, in part, to be exchanged under the Plan of Arrangement and which, immediately after completion of the transactions comprising the Plan of Arrangement, will be identical in every relevant respect to the Vizsla Silver Shares.

"NI 43-101" means National Instrument 43-101 - Standards of Disclosure for Mineral Projects.


"NI 52-110" means National Instrument 52-110 - Audit Committees.

"NI 54-101" means National Instrument 54-101 - Communication with Beneficial Owners of Securities of a Reporting Issuer.

"NI 51-102" means National Instrument 51-102 - Continuous Disclosure Obligations.

"Non Arm's Length parties" has the meaning given to it in TSXV policies.

"Non-Registered Shareholder" means a beneficial Shareholder whose Vizsla Silver Shares are registered in the name of an Intermediary and not the name of the beneficial Shareholder.

"Non-Resident Holder" has the meaning given to it under the heading "Material Canadian Federal Income Tax Considerations - Holders Not Resident in Canada".

"Notice of Dissent" has the meaning given to it under the heading "Dissent Rights".

"Notice of Hearing for Final Order" means the Notice of Hearing Petition for the Final Order, a copy of which is attached as Schedule "E".

"Notice of Meeting" means the notice of special meeting in respect of the Meeting.

"Notice Shares" has the meaning given to it under the heading "Dissent Rights".

"Number of Retained Shares" means the number of Spinco Shares as is necessary for Vizsla Silver to retain approximately 55% of the issued and outstanding Spinco Shares following the Arrangement. For illustrative purposes, figures are presented in this Circular based on the assumption that the Number of Retained Shares will be 100,000,000.

"Number of Spinout Shares" means the number of Spinco Shares that is equal to the Number of Vizsla Silver Shares divided by three. For illustrative purposes, figures are presented in this Circular based on the assumption that the Number of Spinout Shares will be 80,000,000.

"Number of Spinout Warrants" means the number of Spinco Warrants that is equal to the Number of Vizsla Silver Shares divided by three. For illustrative purposes, figures are presented in this Circular based on the assumption that the Number of Spinout Warrants will be 80,000,000.

"Number of Vizsla Silver Shares" means the number of Vizsla Silver Shares expected to be issued and outstanding on the Effective Date. For illustrative purposes, figures are presented in this Circular based on the assumption that the Number of Vizsla Silver Shares will be 240,000,000.

"NYSE American" means the NYSE American LLC.

"Optionee" means the recipient of a Vizsla Silver Option or Spinco Option.

"Option Plan Resolution" means an ordinary resolution which will be considered by Shareholders to approve the Spinco Option Plan, the full text of which is set out in Schedule "B" to this Circular.

"Ordinary Resolution" has the meaning given to it under the heading "General Voting Information - Voting of Proxies".

"Other Concessions" means the concessions comprising the Panuco Project, other than the Silverstone Concessions.

"Panuco Project" has the meaning given to it under the heading "Description and General Development of the Business - Schedule L".


"PFIC" has the meaning given to it under the heading "Material Income Tax Considerations - Material United States Federal Income Tax Considerations".

"Plan of Arrangement" means the plan of arrangement of Vizsla Silver, substantially in the form of Exhibit "I" to the Arrangement Agreement set forth in Schedule "C" hereto, and any amendments or variations thereto made in accordance with the Plan of Arrangement or upon the direction of the Court in the Final Order.

"Post-Closing Steps" has the meaning given to it under the heading "Schedule G - Spinco Following the Arrangement - Post-Closing Steps".

"Proposed Amendments" has the meaning given to it under the heading "Material Income Tax Considerations - Material Canadian Federal Income Tax Considerations".

"PUC" has the meaning given to it under the heading "Material Canadian Federal Income Tax Considerations - Holders Resident in Canada - Exchange of Vizsla Silver Shares for New Vizsla Silver Shares, Spinco Shares and Spinco Warrants".

"QP" means Qualified Person.

"RDSP" means a registered disability savings plan.

"Record Date" means the record date for notice of and voting at the Meeting, being fixed as May 13, 2024.

"Registered Plans" has the meaning given under the heading "Material Canadian Federal Income Tax Considerations - Holders Resident in Canada - Eligibility for Investment - New Vizsla Silver Shares, Spinco Shares and Spinco Warrants".

"Registered Shareholder" means a registered holder of Vizsla Silver Shares.

"Registrar" means the Registrar of Companies appointed pursuant to Section 400 of the BCBCA.

"Regulation S" means Regulation S promulgated under the 1933 Act.

"Regulations" has the meaning given to it under the heading "Material Income Tax Considerations - Material Canadian Federal Income Tax Considerations".

"Resident Holder" has the meaning given under the heading "Material Canadian Federal Income Tax Considerations - Holders Resident in Canada".

"RESP" means a registered education savings plan.

"Royalty" has the meaning given to it under the heading "Schedule G - Spinco Following the Arrangement - Royalty".

"Royalty Agreements" means the royalty agreements dated February 22, 2022 and February 25, 2022 between the Vizsla Silver Mexican Subsidiary and the Spinco Mexican Subsidiary in respect of the Royalty.

"Royalty Buyback Right" has the meaning given to it under the heading "Schedule G - Spinco Following the Arrangement - Royalty".

"Royalty Right Agreement" means the royalty right agreement dated May 8, 2024 between Spinco and Vizsla Silver in respect of the Future Royalty Right.

"RRIF" means a registered retirement income fund.


"RRSP" means a registered retirement savings plan.

"SEC" means the U.S. Securities and Exchange Commission.

"Second Loan" has the meaning given to it under the heading "Schedule G - Spinco Following the Arrangement - Loans".

"SEDAR+" means the System for Electronic Document Analysis and Retrieval +, accessible at www.sedarplus.ca (formerly the System for Electronic Document Analysis and Retrieval).

"Service Providers" means a person who is a bona fide director, officer, employee, management company employee, consultant or company consultant of the Company and also includes a company, 100% of the share capital of which is beneficially owned by one or more Service Providers.

"Share Exchange" has the meaning given to it under the heading "Material Canadian Federal Income Tax Considerations - Exchange of Vizsla Silver Shares for New Vizsla Silver Shares, Spinco Shares and Spinco Warrants".

"Shareholder" means a holder of Vizsla Silver Shares at the applicable time.

"Silverstone Concessions" means certain concessions comprising the Panuco Project which were originally acquired from Silverstone Resources S.A. de CV.

"Spinco" means Vizsla Royalties Corp.

"Spinco Board" means the board of directors of Spinco, as constituted from time to time.

"Spinco Canadian Subsidiary" means Panuco Royalty Corp., a wholly-owned direct subsidiary of Spinco. See "The Arrangement - Details of the Arrangement".

"Spinco Financing" has the meaning given to it under the heading "Schedule G - Spinco Following the Arrangement - Spinco Financing".

"Spinco Mexican Subsidiary" means Canam Royalties Mexico, S.A. de C.V., a wholly-owned indirect subsidiary of Spinco. See "The Arrangement - Details of the Arrangement".

"Spinco Option Plan" means the proposed stock option plan of Spinco, substantially in the form attached as Schedule "K" to this Circular, which is subject to Shareholder approval.

"Spinco Option" means options issued pursuant to the Spinco Option Plan to purchase Spinco Shares, including the Spinco Options issued to holders of Vizsla Silver Options pursuant to the Plan of Arrangement.

"Spinco Service Providers" means a person who is a bona fide director, officer, employee, management company employee, consultant or company consultant of Spinco and also includes a company, 100% of the share capital of which is beneficially owned by one or more Spinco Service Providers.

"Spinco Shareholders" means holders of Spinco Shares.

"Spinco Shares" means no par value shares in the capital of Spinco.

"Spinco Warrant Indenture" means the warrant indenture to be entered into between Spinco and Computershare with respect to the Spinco Warrants.

"Spinco Warrantholders" means holders of Spinco Warrants.


"Spinco Warrants" common share purchase warrants of Spinco, each full Spinco Warrant entitling the holder thereof to purchase one Spinco Share at an exercise price of $0.05 per share for a period expiring on the earlier of: (i) 120 days after the Listing Date; and (ii) December 31, 2025.

"Tax Act" means the Income Tax Act (Canada) as amended.

"taxable capital gain" has the meaning given to it under the heading "Material Canadian Federal Income Tax Considerations - Holders Resident in Canada - Taxation of Capital Gains and Capital Losses".

"TFSA" means a tax-free savings account.

"Treasury Regulations" has the meaning given to it under the heading "Material Income Tax Considerations - Material United States Federal Income Tax Considerations".

"TSXV" means the TSX Venture Exchange.

"United States" means the "United States" as defined in Regulation S under the 1933 Act.

"U.S. Holder" has the meaning given to it under the heading "Material Income Tax Considerations - Material United States Federal Income Tax Considerations".

"U.S. Tax Code" means the U.S. Internal Revenue Code of 1986, as amended.

"Underlying Royalty" means the existing 3.0% net smelter return royalty on certain concessions comprising the Panuco Project.

"Vizsla Silver Class A Shares" means the renamed and re-designated Vizsla Silver Shares as described in section 3.1(b)(i) of the Plan of Arrangement.

"Vizsla Silver Equity Compensation Plan" means the omnibus equity incentive compensation plan of Vizsla Silver, as most recently approved by Shareholders on November 1, 2023.

"Vizsla Silver Mexican Subsidiary" means Minera Canam, S.A. de C.V., a wholly-owned indirect subsidiary of Vizsla Silver. See "The Arrangement - Details of the Arrangement".

"Vizsla Silver Options" means options to purchase Vizsla Silver Shares granted under the Vizsla Silver Equity Compensation Plan.

"Vizsla Silver Replacement Option" means an option to acquire a New Vizsla Silver Share to be issued by Vizsla Silver to the holders of Vizsla Silver Options pursuant to the Plan of Arrangement.

"Vizsla Silver Rights Plan" means the shareholder rights plan of Vizsla Silver dated as of September 8, 2023.

"Vizsla Silver Shares" means the common shares without par value in the capital of Vizsla Silver, as constituted on the date hereof.

"Vizsla Silver Warrant" means the share purchase warrants of Vizsla Silver exercisable to acquire Vizsla Silver Shares, including warrants under the terms of which are deemed exercisable for Vizsla Silver Shares that are outstanding immediately prior to the Effective Time.

"VIF" has the meaning give to it under the heading "General Voting Information - Beneficial Shareholders".

"Warrantholder" means a holder of Vizsla Silver Warrants at the applicable time.


QUESTIONS AND ANSWERS

The following briefly addresses some questions that you may have regarding the proposed spin-off by Vizsla Silver of Vizsla Royalties, pursuant to a court-approved plan of arrangement and certain other related matters described in this Circular. These answers are only a summary and are qualified in their entirety by the more detailed information that follows. In addition, they may not address all of the questions that may be important to you as a Shareholder. Accordingly, we urge you to review the more detailed information contained elsewhere in this Circular. Certain capitalized terms used below are defined in the Glossary of Terms. The cross-references included below are to the section identified in this Circular.

To ensure representation of your Vizsla Silver Shares at the Meeting, whether or not you attend the Meeting, please complete, sign and return your proxy form or, if you are not a Registered Shareholder, please refer to question number 8 below for a description of the procedures to be followed to vote your Vizsla Silver Shares.

1. What do I need to do to ensure that my Vizsla Silver Shares are voted FOR the items listed in the Notice of Special Meeting, including FOR the Arrangement Resolution?

Your feedback and your vote are important to us. We have ensured that voting is easy and accessible. You can vote in person or by proxy at the Meeting, and by proxy on the internet, by phone or by mail. If you are a Registered Shareholder and are unable to attend the Meeting in person, we encourage you to vote by completing the enclosed proxy form. If you are a Non-Registered Shareholder and have received this letter and the Circular from your broker or another Intermediary, please complete and return the proxy form or the voting instruction form provided to you in accordance with the instructions.

If you wish to vote in person at the Meeting, you do not need to complete or return the proxy form. Your vote will be taken and counted at the Meeting. Even if you plan to attend the Meeting, you may find it convenient to express your views in advance by completing and returning the proxy form. Completing, signing and returning your proxy form does not preclude you from attending the Meeting in person nor will it limit your right to vote in person if you attend the Meeting.

If you do not wish to attend the Meeting or do not wish to vote in person, your proxy will be voted for or against the resolutions in accordance with your instructions as specified thereon on any ballot that may be called at the Meeting. In the absence of such instructions, your Vizsla Silver Shares will be voted FOR: (a) the approval of the Arrangement Resolution; and (b) the approval of the Option Plan Resolution. Your proxy must be submitted on the internet, by phone, by fax or by mail and must be executed by the Registered Shareholder or by the Registered Shareholder's attorney authorized in writing or, if the Registered Shareholder is a corporation, by an officer or attorney thereof duly authorized.

On the other hand, if you are a Registered Shareholder and wish to exercise your right to dissent in respect of the Arrangement, you must deliver your written objection to the Arrangement Resolution to Vizsla Silver c/o Forooghian + Company Law Corporation, Suite 401 - 353 Water Street, Vancouver, British Columbia, Canada, V6B 1B8, at or prior to 10:00 a.m. (Vancouver time) on June 13, 2024 or, in the event of any adjournment or postponement of the Meeting, on the Business Day that is at least two Business Days before the date of the adjourned or postponed Meeting, a written objection to the Arrangement Resolution. Any failure to strictly comply with the Dissent Procedures set out in the accompanying Circular may result in the loss or unavailability of your right of dissent. See "Dissent Rights".

If your Vizsla Silver Shares are not registered in your name, but are instead registered in the name of a broker, Intermediary or nominee, please see question number 8 for voting instructions.

2. Who is entitled to vote at the Meeting?

Shareholders as of the close of business on May 13, 2024, or their duly appointed proxies will be entitled to attend the Meeting or register to vote on all matters to be voted on at the Meeting.


3. Who is soliciting my proxy?

Your proxy is being solicited by management of Vizsla Silver ("Management"). Vizsla Silver has retained Laurel Hill Advisory Group as its proxy solicitation agent for assistance in connection with the solicitation of proxies for the Meeting. If you have any questions or require any assistance with completing your proxy, please contact Laurel Hill Advisory Group by telephone at 1-877-452-7184 (toll-free within North America) or +1 416-304-0211 (outside of North America), or by email at assistance@laurelhill.com.

It is expected that the solicitation of proxies will be primarily by mail, but proxies may also be solicited personally, by advertisement or by telephone, by directors, officers or employees of Vizsla Silver without special compensation, or by Computershare at nominal cost. The cost of solicitation will be borne by Vizsla Silver. Computershare is responsible for tabulation of proxies.

4. What do I do with my completed form of proxy?

Return the completed, dated and signed form of proxy in the enclosed envelope to Computershare, Attention: Proxy Department, PO Box 4588 Station A, Toronto, Ontario, M5W 4X1 or otherwise to the Company's registrar and transfer agent, Computershare at 100 University Avenue, 8th Floor, Toronto, Ontario, Canada M5J 2Y1 so that it arrives not later than 10:00 a.m. (Vancouver time) on June 13, 2024 (unless such proxy submission deadline is waived by the Board), or, if the Meeting is adjourned or postponed, not later than 10:00 a.m. (Vancouver time) on the day which is two Business Days preceding the date of the adjourned or postponed Meeting. As well, Shareholders who received these materials through Computershare may vote via the Internet or by telephone by following the instructions provided on the form of proxy. A control number is provided on the proxy form for this purpose. All Vizsla Silver Shares represented by a properly executed proxy received by Computershare prior to such time will be voted in accordance with your instructions as specified in the proxy, on any ballot that may be called at the Meeting.

5. How will my Vizsla Silver Shares be voted if I return my proxy?

The persons named in the form of proxy will vote your Vizsla Silver Shares in accordance with your instructions. In the absence of such instructions, however, your Vizsla Silver Shares will be voted FOR the Arrangement Resolution and FOR the Option Plan Resolution.

6. If I change my mind, can I take back my proxy once I have given it?

Yes. A Registered Shareholder who has given a proxy may revoke it by depositing an instrument in writing signed by the Registered Shareholder or by the Registered Shareholder's attorney, who is authorized in writing, or by transmitting, by telephonic or electronic means, a revocation signed by electronic signature by the Registered Shareholder or by the Registered Shareholder's attorney, who is authorized in writing, to or at the registered office of Vizsla Silver not later than 10:00 a.m. (Vancouver time) on June 14, 2024 or, if the Meeting is adjourned or postponed, not later than 10:00 a.m. (Vancouver time) on the day which is two Business Days preceding the date of the adjourned or postponed Meeting, or with the chairman of the Meeting on the day of, and prior to the start of, the Meeting or any adjournment thereof.

Note that the participation by a Registered Shareholder in a vote by ballot at the Meeting would automatically revoke any proxy that has been previously given by the Registered Shareholder in respect of business covered by that vote.

A Non-Registered Shareholder who received these materials through an Intermediary should follow the instructions provided by the Intermediary.

7. How can I contact Vizsla Silver's transfer agent?

Computershare Trust Company of Canada
100 University Avenue, 8th Floor
Toronto, Ontario, Canada M5J 2Y1
Telephone: 1-800-564-6253


8. If my Vizsla Silver Shares are not registered in my name but are held in the name of an Intermediary (a bank, trust company, securities broker, trustee or otherwise), how do I vote my Vizsla Silver Shares?

If you are a Non-Registered Shareholder who received these materials through Computershare, then follow the instructions set out in question number 4 above.

If you are a Non-Registered Shareholder who did not receive these materials through Computershare, there are, as discussed in the Circular, two ways that you can vote your Vizsla Silver Shares held by your Intermediary. Applicable securities laws require your Intermediary to seek voting instructions from you in advance of the Meeting. Accordingly, you will receive or have already received from your Intermediary either a request for voting instructions or a proxy form for the number of Vizsla Silver Shares you own. Every Intermediary has its own signing and return instructions, which should be carefully followed by Non-Registered Shareholders to ensure that their Vizsla Silver Shares are voted at the Meeting. Accordingly, for your Vizsla Silver Shares to be voted for you, please follow the voting instructions provided by your Intermediary.

However, if you wish to vote in person at the Meeting, insert your own name in the space provided on the request for voting instructions or proxy form to appoint yourself as proxyholder and follow the signing and return instructions of your Intermediary. Non-Registered Shareholders who appoint themselves as proxyholders should, at the Meeting, present themselves to a representative of Computershare. Do not otherwise complete the form sent to you as your vote will be taken and counted at the Meeting.

See "General Voting Information".

9. What am I being asked to vote on at the Meeting?

Shareholders will be voting on the approval of the Arrangement Resolution which provides for the distribution of certain of the Spinco Shares and Spinco Warrants amongst the Shareholders.

Subject to the approval of the Arrangement Resolution, Shareholders will also be voting on the approval of the Option Plan Resolution which will establish, respectively, a stock option plan for Spinco. Further descriptions of the matters covered by each of these resolutions are contained in the sections entitled, "Particulars of Matters to be Acted Upon", "The Arrangement", and "Approval of the Spinco Option Plan".

For more information on the Arrangement, see "The Arrangement". For a description of the Spinco Option Plan, see the heading "Description of Share Capital - Spinco Option Plan" in Schedule "K".

10. Why is the Arrangement being proposed?

The Arrangement will provide long-term option value for Shareholders. Spinco will provide Shareholders with the opportunity to participate in the future success of the Panuco Project. The Board is recommending the Arrangement and believes it enhances the long-term prospects for both Vizsla Silver and Spinco and provides a number of benefits to Shareholders, including, among others:

 providing Shareholders with enhanced value by creating independent investment opportunities in a silver- focused company and royalty company;

 enabling investors, analysts and other stakeholders or potential stakeholders to more accurately evaluate each company and compare the assets to appropriate peers;

 providing each company with a sharper business focus, enabling them to pursue independent business and financing strategies best suited to their respective business plans;

 enabling each company to pursue independent growth and capital allocation strategies; and


 allowing each company to be led by experienced executives and directors who have experience exploring resource properties and building and operating mines.

See "The Arrangement - Reasons for the Arrangement".

11. What approvals are required for the Arrangement to become effective?

For the Arrangement to proceed, the Arrangement Resolution must be approved by at least 66⅔% of the votes cast by Shareholders present in person or represented by proxy at the Meeting, which Shareholders are entitled to one vote for each Vizsla Silver Share held. The Arrangement is not subject to the minority approval requirements of MI 61- 101.

As well as the necessary Shareholder approval, the principal approval required will be that of the Court, which, under the BCBCA, must approve the Arrangement. It is expected that, assuming the requisite Shareholder approval is received at the Meeting, the hearing of the Court on the Arrangement will be held on June 19, 2024 at 9:45 am (Vancouver time) at the Court in Vancouver, British Columbia. The Notice of Hearing Petition for the Final Order (the "Notice of Hearing for Final Order") in connection with the Final Order is included as Schedule "E".

The completion of the Arrangement is also subject to other customary conditions. See "The Arrangement - Conditions to the Arrangement".

12. What are the tax consequences to me if the Arrangement is effected?

Pursuant to Canadian federal income tax laws, a Shareholder (other than a Dissenting Shareholder) who exchanges Vizsla Silver Shares for New Vizsla Silver Shares, Spinco Shares and Spinco Warrants pursuant to the Arrangement will be deemed to have received a taxable dividend equal to the amount, if any, by which the aggregate fair market value of the Spinco Shares and Spinco Warrants distributed to the Shareholder pursuant to the Share Exchange at the time of the Share Exchange exceeds the "paid-up capital" (as defined in the Tax Act) of the Shareholder's Vizsla Silver Shares determined at that time. However, the Company expects that the aggregate fair market value of Spinco Shares and Spinco Warrants distributed to a Shareholder pursuant to the Share Exchange under the Arrangement will not exceed the paid-up capital of the Vizsla Silver Shares to the Shareholder. Accordingly, the Company does not expect that any Shareholder will be deemed to receive a taxable dividend on the Share Exchange.

Further, a Shareholder (other than a Dissenting Shareholder) who is resident in Canada and exchanges Vizsla Silver Shares for New Vizsla Silver Shares, Spinco Shares and Spinco Warrants will also realize a capital gain equal to the amount, if any, by which the aggregate fair market value of those Spinco Shares and Spinco Warrants at the effective time of the Share Exchange, less the amount of any taxable dividend deemed to be received by the Shareholder as described in the preceding paragraph, exceeds the "adjusted cost base" (as defined in the Tax Act) of the Shareholder's Vizsla Silver Shares determined immediately before the Share Exchange.

A Shareholder (other than a Dissenting Shareholder) who is not a resident of Canada for the purpose of the Tax Act and who holds his or her Vizsla Silver Shares as capital property will generally not be subject to tax under the Tax Act on any capital gain arising unless such Shareholder's Vizsla Silver Shares constitute "taxable Canadian property" and such Shareholder is not entitled to relief from Canadian federal income tax under an applicable income tax treaty or convention.

For a more detailed description of the Canadian federal income tax consequences to Shareholders as a result of the Arrangement, see the section of the Circular entitled "Material Canadian Federal Income Tax Considerations". Shareholders should consult their own tax advisors with respect to their particular circumstances.

For a description of the U.S. federal income tax considerations for U.S. Holders as a result of the Arrangement, see the section of the Circular entitled "Material United States Federal Income Tax Considerations". Shareholders should consult their own tax advisors with respect to their particular circumstances.


13. When is the Arrangement likely to occur?

It is presently anticipated that, if all required approvals are obtained and other conditions fulfilled, the Arrangement will become effective on or about June 24, 2024. The Board may, however, decide to delay or not to proceed with the Arrangement, even if all required approvals and consents are obtained.

14. If the Arrangement is effected, what do Shareholders receive?

Shareholders of record as of the close of business on the last trading day on the TSXV immediately prior to the Effective Date, which last trading day is currently expected to be on or about June 21, 2024, will receive, for each one Vizsla Silver Share held, one New Vizsla Silver Share, 1/3 of a Spinco Share and 1/3 of a Spinco Warrant. See "The Arrangement - Proposed Timetable for the Arrangement".

15. If the Arrangement is effected, what do Shareholders need to do in order to receive the New Vizsla Silver Shares, Spinco Shares and Spinco Warrants to which they are entitled?

Concurrently with the mailing of the Circular, Vizsla Silver will mail the Letter of Transmittal to Registered Shareholders, which will be used to exchange their certificates representing Vizsla Silver Shares for certificates representing the New Vizsla Silver Shares, the Spinco Shares and Spinco Warrant.

Upon the Arrangement becoming effective and surrender to the Depositary for cancellation of a certificate or other entitlement which immediately prior to the Effective Time represented outstanding Vizsla Silver Shares together with a Letter of Transmittal which has been completed and signed in the manner required thereby in respect of such certificate and such additional documents and instruments as the Depositary may reasonably require, the holder of such surrendered certificate will be entitled to receive in exchange therefor, and the Depositary will deliver to such holder, certificates or a Direct Registration System Advice ("DRS Advice") representing that number (rounded down to the nearest whole number) of Vizsla Silver Shares, Spinco Shares and Spinco Warrants that such holder has the right to receive pursuant to the Plan of Arrangement and the surrendered certificate will be cancelled. A Letter of Transmittal accompanies this Circular.

Until exchanged, each certificate representing Vizsla Silver Shares will, after the Effective Time, represent only the right to receive, upon surrender, certificates representing the requisite numbers of New Vizsla Silver Shares, Spinco Shares and Spinco Warrants. Shareholders will not receive any fractional Spinco Shares or Spinco Warrants.

Pursuant to the Plan of Arrangement, Registered Shareholders who fail to submit a duly completed Letter of Transmittal and all other documents required by the Depositary and surrender their Vizsla Silver Shares within six years of the Effective Time will no longer have the right to receive New Vizsla Silver Shares, Spinco Shares or Spinco Warrants and will not receive any compensation in lieu thereof.

16. When must I be a Shareholder in order to receive Spinco Shares and Spinco Warrants?

You must be a shareholder of record as of the close of business on the last trading day on the TSXV immediately prior to the Effective Date, which last trading day is currently expected to be on or about June 21, 2024.

Any Shareholder who duly exercises Dissent Rights and, strictly complying with the Dissent Procedures, is ultimately entitled to be paid the fair value for his, her or its Vizsla Silver Shares, will instead be entitled to the fair value of such shares and will not receive New Vizsla Silver Shares, Spinco Shares or Spinco Warrants. See "Dissent Rights".

17. What will be the impact of the Arrangement on the market price and trading of my Vizsla Silver Shares?

Management of Vizsla Silver cannot predict the short-term impact of the Arrangement on the market price and trading of Vizsla Silver Shares but believes that splitting Vizsla Silver into two companies, one focused on advancing the Panuco Project and the other capturing additional long-term value through the Royalty is in the best long-term interest of Shareholders. Shareholders will hold an interest in two separate companies. Subject to certain exceptions, the New Vizsla Silver Shares will remain freely tradable securities upon completion of the Arrangement and will continue trading on the TSXV and on the NYSE American under the symbol "VZLA" and on the Frankfurt Exchange under the symbol "0G3". See "The Arrangement" and "Certain Securities Law Matters".


18. When will the Spinco Shares and Spinco Warrants be listed on the TSXV?

While Spinco has made an application with the TSXV to list the Spinco Shares and Spinco Warrants, there is no guarantee when, or if, such listings will be completed. Such listings will be subject to Spinco fulfilling all of the listing requirements of the TSXV.

19. What if I want to sell my Spinco Shares or Spinco Warrants?

Until the Spinco Shares and Spinco Warrants are listed on a stock exchange, Spinco Shareholders and Spinco Warrantholders may not be able to sell their Spinco Shares or Spinco Warrants. This may affect the pricing of the Spinco Shares and Spinco Warrants in the secondary market and the liquidity of the Spinco Shares and Spinco Warrants. Spinco Shareholders and Spinco Warrantholders are advised to consult their legal advisors with respect to trading of the Spinco Shares and Spinco Warrants. Shareholders should carefully consider the risks identified in this Circular under the heading "The Arrangement - Risk Factors Relating to the Arrangement" and under the heading "Risk Factors" in Schedules "G" and "L".

20. What are the terms of the Spinco Warrants?

Each full Spinco Warrant entitles the holder thereof to purchase one Spinco Share at an exercise price of $0.05 per share for a period expiring on the earlier of: (i) 120 days after the Listing Date; and (ii) December 31, 2025.

21. How do I exercise my Spinco Warrants?

The Spinco Warrants will be governed by the Spinco Warrant Indenture, a copy of which will be made available on SEDAR+. Spinco Warrantholders must follow the procedures outlined in the Spinco Warrant Indenture to exercise their Spinco Warrants.

22. What will be the ownership structure of Spinco after completion of the Arrangement?

Immediately after completion of the Arrangement, Shareholders are expected to hold approximately 45% of the issued and outstanding Spinco Shares, while Vizsla Silver will retain the remaining approximately 55%. Vizsla Silver is not expected to retain any Spinco Warrants. The overall ownership structure is expected to change upon completion of the Post-Closing Steps and the exercise of any Spinco Warrants.

See "Schedule G - Spinco Following the Arrangement".

23. Who should I contact if I have questions regarding the Arrangement?

Answers to many of your questions may be found in the accompanying Circular. If after reviewing the Circular you have questions about voting your proxy, please contact Laurel Hill Advisory Group by telephone at 1-877-452-7184 (toll-free within North America) or +1 416-304-0211 (outside of North America), or by email at assistance@laurelhill.com. If you have questions about the Arrangement, please contact Vizsla Silver by telephone at (604) 364-2215 or by e-mail at info@vizslasilver.ca. In addition, you may wish to consult your financial, tax and/or legal advisors.

24. How can I get more information about Spinco and its assets?

Additional information about Spinco, its assets and its business strategy can be found by contacting the Company by telephone at (604) 364-2215 or by e-mail at info@vizslasilver.ca.


SUMMARY

The following is a summary of the principal features of the Arrangement and certain other matters and should be read together with the more detailed information and financial statements contained elsewhere in this Circular, including the schedules hereto. Capitalized terms not otherwise defined in this summary are defined in the Glossary of Defined Terms or elsewhere in this Circular. This summary is qualified in its entirety by the more detailed information appearing or referred to elsewhere in this Circular.

THE MEETING

Vizsla Silver has fixed May 13, 2024 as the record date for determining the Shareholders entitled to receive notice of and vote at the Meeting. The Meeting will be held at 555 Burrard Street, 11th Floor, Suite 1165, Vancouver, British Columbia V7X 1M8 on June 17, 2024, at 10:00 a.m. (Vancouver time).

At the Meeting, Shareholders will be asked to consider the following special meeting matters:

 approving, with or without amendment, the Arrangement Resolution; and

 subject to the approval of the Arrangement Resolution, approving the Spinco Option Plan.

By passing the Arrangement Resolution, Shareholders will also be giving authority to the Board to use its best judgment to proceed with and cause Vizsla Silver to complete the Arrangement in the event of any variation of, or amendments to, the Arrangement Agreement or Plan of Arrangement without any requirement to seek or obtain any further approval of the shareholders.

For further information on voting Vizsla Silver Shares at the Meeting, see the section entitled "General Voting Information". For a description of the Spinco Option Plan, please refer to Schedule "G" or the full text of the Spinco Option Plan in Schedule "K".

THE ARRANGEMENT

The purpose of the Arrangement and the related transactions is to reorganize Vizsla Silver into two separate companies: Vizsla Silver, a publicly-traded silver exploration company focused on advancing the flagship Panuco Project, and Spinco, a royalty focused company with initial assets comprised of the Royalty, the Royalty Buyback Right and the Future Royalty Right. The Arrangement would result in, among other things, participating Shareholders holding, immediately following completion of the Arrangement, all of the outstanding New Vizsla Silver Shares, approximately 45% of the outstanding Spinco Shares (with the remaining approximately 55% initially being retained by Vizsla Silver) and all of the outstanding Spinco Warrants. For a summary of the steps of the Arrangement and related transactions, see the section entitled "The Arrangement - Details of the Arrangement".

REASONS FOR THE ARRANGEMENT

The Board believes that the creation of two separate companies, one a publicly-traded silver-gold exploration company focused on the advancement of the flagship Panuco Project and the other, a royalty company, will provide a number of benefits to Vizsla Silver, Spinco and the Shareholders, including: providing Shareholders with enhanced value by creating independent investment opportunities in a silver-gold exploration company and a royalty company; providing each company with the ability to pursue independent business and financing strategies best suited to their respective business plans.

See further details under the section entitled "The Arrangement - Reasons for the Arrangement".


RECOMMENDATION OF THE BOARD

The Board, having reviewed the Plan of Arrangement and related transactions and considered, among other things, the reasons for the Arrangement, has unanimously determined that the Arrangement is in the best interests of Vizsla Silver and the Shareholders. The Board has unanimously approved the Arrangement and the transactions contemplated thereby and unanimously recommends that Shareholders vote FOR the Arrangement Resolution and, subject to approval of the Arrangement Resolution, that Shareholders vote FOR the Option Plan Resolution.

See further details under the section entitled "The Arrangement - Recommendation of the Board".

CONDITIONS TO CLOSING

The Arrangement will be subject to the satisfaction or waiver, as applicable, of certain conditions, including the following:

 the Arrangement Resolution must be approved by at least 66 2/3% of the votes cast by Shareholders present in person or represented by proxy at the Meeting, which Shareholders are entitled to one vote for each Vizsla Silver Share held;

 the Arrangement must be approved by the Court and the Final Order obtained in a form and substance satisfactory to Vizsla Silver; and

 all other consents, orders and approvals that are required, necessary or desirable for the completion of the Arrangement must have been obtained or received, each in a form and substance acceptable to Vizsla Silver.

See further details under the section entitled "The Arrangement - Conditions to the Arrangement".

COURT APPROVAL

An arrangement under the BCBCA requires approval of the Court. Prior to mailing this Circular, Vizsla Silver obtained the Interim Order, which provides for the calling and holding of the Meeting, Dissent Rights and certain other procedural matters. A copy of the Interim Order is attached as Schedule "D".

Subject to the approval of the Arrangement Resolution by Shareholders at the Meeting, Vizsla Silver intends to make an application to the Court for the Final Order on June 19, 2024 at 9:45 am (Vancouver time) or as soon thereafter as counsel may be heard at the Court house at 800 Smithe Street, Vancouver, British Columbia or at any other date and time as the Court may direct. At the hearing, any Shareholder or other interested party who wishes to participate or be represented or present arguments or evidence must file and serve a response to petition no later than 4:00 p.m. (Vancouver time) on June 17, 2024 along with any other documents required, all as set out in the Interim Order and Notice of Hearing for Final Order, copies of which are attached as Schedule "D" and "E", respectively, and satisfy any other requirement of the Court.

The Court may approve the Arrangement either as proposed or as amended in any manner the Court may direct, and subject to compliance with such terms and conditions, if any, as the Court sees fit.

See further details under the section entitled "The Arrangement - Court Approval of the Arrangement".

EFFECTIVE DATE

Upon receipt of the Final Order, Vizsla Silver will announce by news release the proposed Effective Date of the Arrangement, which is expected to be on or about June 24, 2024. You must be a shareholder of record as of the close of business on the last trading day on the TSXV immediately prior to the Effective Date, which last trading day is currently expected to be on or about June 21, 2024.


STOCK EXCHANGE LISTINGS

The Vizsla Silver Shares are currently listed and traded on the TSXV and the NYSE American under the symbol "VZLA" and on the Frankfurt Exchange under the symbol "0G3".

While Spinco has made an application with the TSXV to list the Spinco Shares and Spinco Warrants, there is no guarantee when, or if, such listings will be completed. Such listings will be subject to Spinco fulfilling all of the listing requirements of the TSXV. The listing of the Spinco Shares and Spinco Warrants on the TSXV is not a condition to completion of the Arrangement.

VIZSLA SILVER FOLLOWING THE ARRANGEMENT

Following completion of the Arrangement, Vizsla Silver will continue to focus on advancing the Panuco Project, while Spinco will allow shareholders to capture additional long-term value through the Royalty. Vizsla Silver's near- term focus will continue to be the advancement of the 100%-owned Panuco Project.

Following completion of the Arrangement, the New Vizsla Silver Shares will continue to be traded on the TSXV.

For a more detailed description of Vizsla Silver following the completion of the Arrangement, see Schedule "L".

SPINCO FOLLOWING THE ARRANGEMENT

Spinco is expected to operate as royalty company focused on gaining exposure to commodity prices by making strategic investments in mining interests, including royalties, streams, debt and equity investments in mining companies, as well as through the holdings of physical commodities.

While Spinco has made an application with the TSXV to list the Spinco Shares and Spinco Warrants, there is no guarantee when, or if, such listings will be completed. Such listings will be subject to Spinco fulfilling all of the listing requirements of the TSXV.

For a more detailed description of Spinco following the completion of the Arrangement, see Schedule "G".

DISTRIBUTION OF SHARE CERTIFICATES

Concurrently with the mailing of the Circular, Vizsla Silver will mail the Letter of Transmittal to Registered Shareholders, which will be used to exchange their certificates representing Vizsla Silver Shares for certificates representing the New Vizsla Silver Shares, Spinco Shares and Spinco Warrants.

Upon the Arrangement becoming effective and surrender to the Depositary for cancellation of a certificate or other entitlement which immediately prior to the Effective Time represented outstanding Vizsla Silver Shares together with a Letter of Transmittal which has been completed and signed in the manner required thereby in respect of such certificate and such additional documents and instruments as the Depositary may reasonably require, the holder of such surrendered certificate will be entitled to receive in exchange therefor, and the Depositary will deliver to such holder, certificates or a DRS Advice representing that number (rounded down to the nearest whole number) of New Vizsla Silver Shares, Spinco Shares and Spinco Warrants that such holder has the right to receive pursuant to the Plan of Arrangement and the surrendered certificate will be cancelled. A Letter of Transmittal accompanies this Circular.

Until exchanged, each certificate representing Vizsla Silver Shares will, after the Effective Time, represent only the right to receive, upon surrender, certificates representing the requisite numbers of New Vizsla Silver Shares, Spinco Shares and Spinco Warrants. Shareholders will not receive any fractional Spinco Shares or Spinco Warrants.

Shareholders who fail to submit their certificates representing Vizsla Silver Shares together with a duly completed Letter of Transmittal and any other documents required by the Depositary on or before the sixth anniversary of the Effective Date will cease to have any right or claim against or interest of any kind or nature in Vizsla Silver or Spinco. Accordingly, persons who tender certificates for Vizsla Silver Shares after the sixth anniversary of the Effective Date will not receive any New Vizsla Silver Shares, Spinco Shares or Spinco Warrants, will not own any interest in Vizsla Silver or Spinco and will not be paid any cash or other compensation in lieu thereof.


DISSENT RIGHTS

The Interim Order provides that each Registered Shareholder may exercise Dissent Rights in accordance with section 237 to 247 of the BCBCA as modified by the Plan of Arrangement, the Interim Order and the Final Order in respect of the Arrangement. Each Dissenting Shareholder is entitled to be paid the fair value of all, but not less than all, of the holder's Vizsla Silver Shares, provided that the holder duly dissents to the Arrangement Resolution and the Arrangement becomes effective.

To exercise Dissent Rights, Registered Shareholders must provide written notice to Vizsla Silver c/o Forooghian + Company Law Corporation, Suite 401 - 353 Water Street, Vancouver, British Columbia, Canada, V6B 1B8 at or before 10:00 (Vancouver time) on June 13, 2024 (or on the Business Day that is two Business Days immediately preceding any adjourned or postponed Meeting) in the manner described under the heading "Dissent Rights". If a Registered Shareholder exercises Dissent Rights in strict compliance with the BCBCA and Interim Order and the Arrangement is completed, such Dissenting Shareholder is entitled to be paid the "fair value" of the Vizsla Silver Shares with respect to which Dissent Rights were exercised, as calculated immediately before the passing of the Arrangement Resolution. Only Registered Shareholders are entitled to exercise Dissent Rights. Beneficial Shareholders who wish to exercise Dissent Rights must cause each Registered Shareholder holding their Vizsla Silver Shares to deliver the required notice of dissent or, alternatively, make arrangements to become Registered Shareholders. Shareholders should carefully read the section of this Circular entitled "Dissent Rights" and consult with their advisors if they wish to exercise Dissent Rights. Any failure to fully comply with the provisions of the BCBCA, as modified by the Plan of Arrangement, the Interim Order and the Final Order in respect of the Arrangement, may result in a loss of that holder's Dissent Rights.

CANADIAN SECURITIES LAWS MATTERS

Vizsla Silver is a reporting issuer in each of the provinces and territories of Canada.

The Vizsla Silver Shares currently trade on the TSXV.

After the Arrangement, Spinco will be a reporting issuer each of the provinces and territories in Canada. While Spinco has made an application with the TSXV to list the Spinco Shares and Spinco Warrants, there is no guarantee when, or if, such listings will be completed. Such listings will be subject to Spinco fulfilling all of the listing requirements of the TSXV.

The distribution of the Spinco Shares and Spinco Warrants pursuant to the Arrangement will constitute a distribution of securities which is exempt from prospectus requirements of Canadian securities legislation. With certain exceptions, the Spinco Shares and Spinco Warrants may generally be resold in each of the provinces of Canada provided the trade is not a "control distribution" as defined in National Instrument 45-102 ─ Resale of Securities, no unusual effort is made to prepare the market or create a demand for those securities, no extraordinary commission or consideration is paid to a person or company in respect of the trade and, if the selling security holder is an insider or officer of Spinco, the insider or officer has no reasonable grounds to believe that Spinco is in default of securities legislation.

See further details under the section entitled "Certain Securities Law Matters - Canadian Securities Laws".

U.S. SECURITIES LAWS MATTERS

The Vizsla Silver Shares currently trade on the NYSE American.

The New Vizsla Silver Shares, Spinco Shares and Spinco Warrants to be issued or deemed to be issued to Shareholders in the United States pursuant to the Arrangement will not be registered under the 1933 Act or the securities laws of any state of the United States and will be distributed in reliance upon the exemption from registration provided by Section 3(a)(10) of the 1933 Act and available exemptions from applicable state registration requirements. The New Vizsla Silver Shares, Spinco Shares and Spinco Warrants issued or deemed to be issued to Shareholders in the United States pursuant to the Arrangement will generally not be subject to resale restrictions under U.S. federal securities laws for persons who are not affiliates of Vizsla Silver or Spinco following the Arrangement or within 90 days prior to the Arrangement.


See further details under the section entitled "Certain Securities Law Matters - U.S. Securities Laws".

MATERIAL CANADIAN INCOME TAX CONSIDERATIONS

A summary of material Canadian federal income tax considerations for Shareholders who participate in the Arrangement is set out under the heading "Material Canadian Federal Income Tax Considerations".

Shareholders should carefully review the tax considerations applicable to them under the Arrangement and are urged to consult their own legal, tax and financial advisors in regard to their particular circumstances.

MATERIAL UNITED STATES FEDERAL INCOME TAX CONSIDERATIONS

A summary of material United States federal income tax considerations for U.S. Holders who participate in the Arrangement is set out under the heading "Material United States Federal Income Tax Considerations".

Shareholders should carefully review the tax considerations applicable to them under the Arrangement and are urged to consult their own legal, tax and financial advisors in regard to their particular circumstances.

RISK FACTORS

Shareholders should be aware that there are various known and unknown risk factors in connection with the Arrangement and the ownership of New Vizsla Silver Shares, Spinco Shares and Spinco Warrants following the completion of the Arrangement. Shareholders should carefully consider the risks identified in this Circular under the heading "The Arrangement - Risk Factors Relating to the Arrangement" and under the heading "Risk Factors" in Schedules "G" and "L" before deciding whether or not to approve the Arrangement Resolution.

GENERAL VOTING INFORMATION

PERSONS MAKING THIS SOLICITATION OF PROXIES

In accordance with NI 54-101, arrangements have been made with brokerage houses and clearing agencies, custodians, nominees, fiduciaries or other intermediaries to forward the Company's proxy solicitation materials to the beneficial owners of the Vizsla Silver Shares held of record by such parties. The Company may reimburse such parties for reasonable fees and disbursements incurred by them in doing so.

Vizsla Silver has also retained Laurel Hill Advisory Group as its proxy solicitation agent for assistance in connection with the solicitation of proxies, among other responsibilities, for a fee of $45,000 for such services, in addition to certain out-of-pocket expenses. Vizsla Silver may also reimburse brokers, investment dealers or other intermediaries holding Shares in their name or in the name of nominees for their costs incurred in sending proxy materials to their principals.

If you have any questions or need assistance voting, please contact Laurel Hill Advisory Group by telephone at 1-877- 452-7184 (toll-free within North America) or +1 416-304-0211 (outside of North America), or by email at assistance@laurelhill.com.

APPOINTMENT OF PROXYHOLDERS AND COMPLETION AND REVOCATION OF PROXIES

The purpose of a proxy is to designate persons who will vote the proxy on a Shareholder's behalf in accordance with the instructions given by the shareholder in the proxy. The persons named in the enclosed proxy (the "Management Designees") have been selected by the directors of the Company.

A Shareholder has the right to designate a person (whom need not be a Shareholder) other than the Management Designees to represent them at the Meeting. Such right may be exercised by inserting in the space provided for that purpose on the proxy the name of the person to be designated and by deleting therefrom the names of the Management Designees, or by completing another proper form of proxy and delivering the same to the transfer agent of the Company. Such Shareholder should notify the nominee of the appointment, obtain the nominee's consent to act as proxyholder and provide instructions on how the shareholder's shares are to be voted. The nominee should bring personal identification with them to the Meeting. To be valid, the proxy must be dated and executed by the Shareholder or an attorney authorized in writing, with proof of such authorization attached (where an attorney executed the proxy).


REGISTERED SHAREHOLDERS

Registered Shareholders may wish to vote by proxy whether or not they are able to attend the Meeting in person. Registered Shareholders electing to submit a proxy may do so by:

(a) using the internet through the website of the Company's transfer agent at www.investorvote.com. Registered Shareholders must follow the instructions that appear on the screen and refer to the enclosed form of proxy for the holder's account number and the proxy access number;

(b) using a touch-tone phone to transmit voting choices to a toll-free number. Registered Shareholders must follow the instructions of the voice response system and refer to the enclosed form of proxy for the toll-free number, the holder's account number and the proxy access number; or

(c) completing, dating and signing the enclosed form of proxy and returning it to the Company's transfer agent, Computershare, by mail at 100 University Avenue, 8th Floor, Toronto, Ontario, Canada, M5J 2Y1, attention Proxy Department; by fax within North America at 1-866-249-7775, outside North America at (416) 263- 9524; or by mail or by hand to 3rd Floor, 510 Burrard Street, Vancouver, British Columbia, Canada, V6C 3B9.

In all cases, the proxy must be received at least 48 hours (excluding Saturdays, Sundays and holidays) before the Meeting or the adjournment thereof at which the proxy is to be used. Proxies received after that time may be accepted by the chair of the Meeting at such person's discretion, and the chair of the Meeting is under no obligation to accept late proxies. The time limit for deposit of proxies may be waived or extended by the Chair of the Meeting as his or her discretion, without notice.

BENEFICIAL SHAREHOLDERS

The information set forth in this section is of significant importance as many Shareholders do not hold Vizsla Silver Shares in their own name.

Only Shareholders whose names appear on the records of the Company as the registered holders of Vizsla Silver Shares or duly appointed proxyholders are permitted to vote at the Meeting. Most Shareholders are Non- Registered Shareholders, because the Vizsla Silver Shares they own are not registered in their names but instead registered in the name of an Intermediary, including a nominee such as a brokerage firm through which they purchased the Vizsla Silver Shares; bank, trust company, trustee or administrator of self-administered RRSPs, RRIFs, RESPs and similar plans; or clearing agency such as the Canadian Depository for Securities Limited. If you purchased your Vizsla Silver Shares through a broker, you are likely a Non-Registered Shareholder.

In accordance with securities regulatory policy and the requirements of NI 54-101, the Company has distributed copies of the Meeting materials, being the Notice of Meeting, this Circular and the form of proxy, to Intermediaries for distribution to Non-Registered Shareholders.

Intermediaries are required to forward the Meeting materials to Non-Registered Shareholders to seek their voting instructions in advance of the Meeting. Vizsla Silver Shares held by Intermediaries can only be voted in accordance with the instructions of the Non-Registered Shareholder. Generally, Non-Registered Holders will either be given a voting instruction form (a "VIF") which must be completed and signed by the Non-Registered Holder in accordance with the directions on the voting instruction form. Non-Registered Holders should submit voting instruction forms to Intermediaries in sufficient time to ensure that their votes are received from the Intermediaries by the Company. Most brokers delegate responsibility for obtaining instructions from clients to Broadridge Financial Services ("Broadridge"). Broadridge mails a VIF in lieu of a proxy provided by the Company. The completed VIF must be returned by mail (using the return envelope provided) or by facsimile. Alternatively, Non-Registered Holders may call a toll-free number or go online to www.proxyvote.com to vote. Broadridge then tabulates the results of all instructions received and provides appropriate instructions respecting the voting of shares to be represented at the Meeting. The Company through Laurel Hill may utilize the Broadridge QuickVote™ service to assist eligible Non- registered Shareholders with voting their shares over the phone.


If you, as a Non-Registered Shareholder, wish to vote at the Meeting in person, you should appoint yourself as proxyholder by writing your name in the space provided on the request for voting instructions or proxy provided by the Intermediary and you should return the form to the Intermediary in the envelope provided. Do not complete the voting section of the form as your vote will be taken at the Meeting.

Alternatively, Non-Registered Holders may be given a proxy which has already been signed by the Intermediary (typically by a facsimile, stamped signature) which is restricted as to the number of Shares beneficially owned by the Non-Registered Holder but which is otherwise uncompleted. This form of proxy need not be signed by the Non- Registered Holder. In this case, the Non-Registered Holder who wishes to submit a proxy should otherwise properly complete the form of proxy and deposit it with Computershare, as described above under "Registered Shareholders".

If you have any questions or need assistance completing your form of proxy or voting instruction form, please contact the Company's proxy solicitation agent, Laurel Hill Advisory Group, by telephone at 1-877-452-7184 (toll-free within North America) or +1 416-304-0211 (outside of North America), or by email at assistance@laurelhill.com.

VOTING OF PROXIES

The Board of Directors has set May 13, 2024 as the record date for determining the Shareholders entitled to receive notice of and vote at the Meeting. Voting at the Meeting will be by a show of hands, each registered Shareholder and each proxyholder (representing a registered Shareholder or unregistered Shareholder) having one vote, unless a poll is required or requested, whereupon each such Shareholder and/or proxyholder is entitled to one vote for each Vizsla Silver Share held or represented. Each Shareholder may instruct their proxyholder how to vote their Vizsla Silver Shares by completing the blanks on the proxy. All Vizsla Silver Shares represented at the Meeting by properly executed proxies will be voted or withheld from voting when a poll is required or requested and, where a choice with respect to any matter to be acted upon has been specified in the form of proxy, the Vizsla Silver Shares represented by the proxy will be voted in accordance with such specification. In the absence of any such specification as to voting on the proxy, the Management Designees, if named as proxyholder, will vote in favour of the matters set out therein.

The enclosed proxy confers discretionary authority upon the Management Designees, or other person named as proxyholder, with respect to amendments to or variations of matters identified in the Notice of Meeting and any other matters which may properly come before the Meeting. As of the date hereof, the Company is not aware of any amendments to, variations of or other matters which may come before the Meeting. If other matters come before the Meeting, then the Management Designees intend to vote in accordance with the judgment of the Company.

In order to approve a motion proposed at the Meeting, a majority of greater than 50% of the votes cast will be required (an "Ordinary Resolution") unless the motion requires a "special resolution" in which case a majority of 662/3% of the votes cast will be required.

REVOCATION OF PROXIES

Any Registered Shareholder who has returned a proxy may revoke it at any time before it has been exercised. A proxy may be revoked by a Registered Shareholder personally attending at the Meeting and voting their Vizsla Silver Shares. A Shareholder may also revoke their proxy in respect of any matter upon which a vote has not already been cast by depositing an instrument in writing, including a proxy bearing a later date executed by the Registered Shareholder or by their authorized attorney in writing, or, if the Shareholder is a company, under its corporate seal by an officer or attorney thereof duly authorized, either at the office of the Company's registrar and transfer agent at the foregoing address or the head office of the Company at 595 Burrard Street, Suite 1723, Vancouver, British Columbia V7X 1K8 at any time up to and including the last business day preceding the date of the Meeting, or any adjournment thereof at which the proxy is to be used, or by depositing the instrument in writing with the Chairman of such Meeting, or any adjournment thereof, or in any other manner permitted by law. Only Registered Shareholders have the right to revoke a proxy. Non-Registered Shareholders who wish to change their vote must, at least seven days before the Meeting, arrange for their respective Intermediary to revoke the proxy on their behalf.


QUORUM

The Articles of the Company provide that a quorum for the transaction of business at any meeting of shareholders will be two shareholders present in person or represented by proxy who hold, in the aggregate, at least 5% of the issued shares entitled to be voted at the Meeting.

VOTING SECURITIES AND PRINCIPAL HOLDERS OF VOTING SECURITIES

The authorized share capital of the Company is an unlimited amount of Vizsla Silver Shares. As at the date of this Circular, there were 233,121,498 Vizsla Silver Shares issued and outstanding, each carrying the right to one vote per share.

Shareholders registered as at May 13, 2024, are entitled to attend and vote at the Meeting. Shareholders who wish to be represented by proxy at the Meeting must, to entitle the person appointed by the proxy to attend and vote, deliver their proxies at the place and within the time set forth in the notes to the proxy.

To the knowledge of the directors and senior officers of the Company, as at the date of this Circular, no person beneficially owns, or controls or directs, directly or indirectly, more than 10% of the outstanding shares.

INTEREST OF CERTAIN PERSONS OR COMPANIES IN MATTERS TO BE ACTED UPON

Except as set out herein, no person who has been a director or executive officer of the Company at any time since the beginning of the Company's last financial year and no associate or affiliate of the foregoing persons, has any material interest, direct or indirect, by way of beneficial ownership or otherwise, in matters to be acted upon at the Meeting.

PARTICULARS OF MATTERS TO BE ACTED UPON

APPROVAL OF THE ARRANGEMENT

Shareholders will be asked to approve the Arrangement Resolution, the full text of which is attached as Schedule "A" to the Circular for a statutory arrangement under section 288 of the BCBCA which involves, among other things, the distribution of Spinco Shares and Spinco Warrants to Shareholders of the Company on the basis of 1/3 of a Spinco Share and 1/3 of a Spinco Warrant for each Vizsla Silver Share held, as more fully described in the Circular. See "The Arrangement" below.

Management unanimously recommends a vote FOR in respect of the Arrangement Resolution. Unless otherwise directed, it is the intention of the Management Designees, if named as proxyholder, to vote in favour of the approval of the Arrangement Resolution.

APPROVAL OF THE SPINCO OPTION PLAN

As the Vizsla Silver Equity Compensation Plan will not carry forward to Spinco, if the Arrangement Resolution is approved at the Meeting, Shareholders will also be asked to consider and, if thought appropriate, pass the Option Plan Resolution in substantially the form set forth in Schedule "A". See "Description of Share Capital" in Schedule "G".

Management unanimously recommends a vote FOR in respect of the Option Plan Resolution. Unless otherwise directed, it is the intention of the Management Designees, if named as proxyholder, to vote in favour of the approval of the Option Plan Resolution.


MANAGEMENT CONTRACTS

Except as set out herein, there are no management functions of the Company that are to any substantial degree performed by a person or company other than the directors or senior officers of the Company.

INTEREST OF INFORMED PERSONS IN MATERIAL TRANSACTIONS

Except as disclosed below and herein, no informed person (as defined in NI 51-102) or director of the Company and no associate or affiliate of the foregoing persons has or has had any material interest, direct or indirect, in any transaction since the commencement of the Company's most recently completed financial year or in any proposed transaction which in either such case has materially affected or would materially affect the Company or any of its subsidiaries.

Certain directors and officers of Vizsla Silver are also directors, officers or shareholders of other companies that are similarly engaged in the business of acquiring, developing and exploiting mineral properties. Such associations to other engaged companies in the resource sector may give rise to conflicts of interest from time to time. As a result, opportunities provided to a director of Vizsla Silver may not be made available to Vizsla Silver but, rather, may be offered to a company with competing interests. The directors and senior officers of Vizsla Silver are required by law to act honestly and in good faith with a view to the best interests of Vizsla Silver and to disclose any personal interest which they may have in any project or opportunity of Vizsla Silver, and to abstain from voting on such matters.

The directors and officers of Vizsla Silver are aware of the existence of laws governing the accountability of directors and officers for corporate opportunity and requiring disclosure by the directors of conflicts of interest and Vizsla Silver will rely upon such laws in respect of any directors' and officers' conflicts of interest or in respect of any breaches of duty by any of its directors and officers.

THE ARRANGEMENT

GENERAL

The purpose of the Arrangement is to reorganize Vizsla Silver and its assets and operations into two separate companies: Vizsla Silver and Spinco.

REASONS FOR THE ARRANGEMENT

The Board believes that the creation of two separate companies, one a public mineral exploration company with a focus of acquiring and exploring mineral properties and the other a royalty-focused company, will provide a number of benefits to Vizsla Silver, Spinco and the Shareholders, including:

 allowing shareholders to continue to benefit from the advancement of the 100%-owned Panuco Project; and

 providing shareholders with the ability to fully benefit from the future development of the Panuco Project through share ownership in Spinco.

In view of the factors and information considered in connection with their evaluation of the Arrangement, the Board did not find it practicable to, and therefore did not, quantify or otherwise attempt to assign any relative weight to each specific factor or item of information considered in reaching their conclusions and recommendations. In addition, individual members of the Board may have given different weights to different factors or items of information.

RECOMMENDATION OF THE BOARD

The Board approved the Arrangement and recommended and authorized the submission of the Arrangement to the Shareholders and the Court for approval. The Board has concluded that the Arrangement is in the best interests of Vizsla Silver and its Shareholders and recommends that Shareholders vote FOR the Arrangement Resolution proposed to be passed at the Meeting.


In reaching this conclusion, the Board considered, among other things, the benefits to Vizsla Silver and its Shareholders, as well as the financial position, opportunities and outlook for the future potential and operating performance of Vizsla Silver and Spinco, respectively.

DETAILS OF THE ARRANGEMENT

The following description is qualified in its entirety by reference to the full text of the Plan of Arrangement, a copy of which is attached as Exhibit "I" to the Arrangement Agreement attached as Schedule "C" to this Circular. Shareholders are urged to carefully read the Plan of Arrangement in its entirety.

At the Effective Time and pursuant to the Plan of Arrangement, the following transactions, among others, will occur and will be deemed to occur sequentially in the following order:

 Each Vizsla Silver Share outstanding in respect of which a Dissenting Shareholder has validly exercised his, her or its Dissent Rights will be directly transferred and assigned by such Dissenting Shareholder to Vizsla Silver, without any further act or formality and free and clear of any liens, charges and encumbrances of any nature whatsoever, and will be cancelled and cease to be outstanding and such Dissenting Shareholders will cease to have any rights as Shareholders other than the right to be paid the fair value for their Vizsla Silver Shares by Vizsla Silver.

 The authorized share structure of Vizsla Silver will be reorganized and altered by: (a) renaming and re- designating all of the issued and unissued Vizsla Silver Shares as Vizsla Silver Class A Shares; and (b) creating the New Vizsla Silver Shares, with rights and restrictions identical to those of the Vizsla Silver Shares immediately prior to the Effective Time.

 Vizsla Silver's Notice of Articles will be amended to reflect the above alterations to its share structure.

 Each Vizsla Silver Option then outstanding to acquire one Vizsla Silver Share will be deemed to be exchanged for: (a) one Vizsla Silver Replacement Option to acquire one New Vizsla Silver Share having an exercise price equal to the product of the original exercise price of the Vizsla Silver Option multiplied by the fair market value of a New Vizsla Silver Share at the Effective Time divided by the total of the fair market value of a New Vizsla Silver and the fair market value of 1/3 of a Spinco Share at the Effective Time; and

(b) one Spinco Option to acquire 1/3 of a Spinco Share, each whole Spinco Option having an exercise price equal to the product of the original exercise price of the Vizsla Silver Option multiplied by the fair market value of 1/3 of a Spinco Share at the Effective Time divided by the total of the fair market value of one New Vizsla Silver Share and 1/3 of a Spinco Share at the Effective Time, provided that the aforesaid exercise prices will be adjusted to the extent, if any, required to ensure that the aggregate In the Money Amount of the Vizsla Silver Replacement Option and the Spinco Option immediately after the exchange does not exceed the In the Money Amount immediately before the exchange of the Vizsla Silver Option so exchanged and solely with respect to U.S. Holders, in order to ensure compliance with applicable provisions of the Internal Revenue Code of 1986, as amended. It is intended that subsection 7(1.4) of the Tax Act apply to the exchange of Vizsla Silver Option.

The Board will define the fair market value of the Spinco Shares, acting in good faith, prior to the Effective Date. The Board's determination of fair market value will be calculated by taking into account the assets and liabilities of Spinco as well as valuations of comparable royalty transactions. The Board has received a valuation to support its determination of fair market value.

 Each Vizsla Silver Warrant outstanding will be deemed to be amended to entitle the Vizsla Silver Warrantholder to receive, upon due exercise of the Vizsla Silver Warrant, for the original exercise price: (a) one New Vizsla Silver Share for each Vizsla Silver Share that was issuable upon due exercise of the Vizsla Silver Warrant immediately prior to the Effective Time; and (b) 1/3 of a Spinco Share for each Vizsla Silver Share that was issuable upon due exercise of the Vizsla Silver Warrant immediately prior to the Effective Time.

Spinco will upon receipt of written notice from Vizsla Silver from time-to-time issue, as directed by Vizsla Silver, that number of Spinco Shares as may be required to satisfy the exercise of Vizsla Silver Warrants. 


Vizsla Silver will, as agent for Spinco, collect and pay to Spinco an amount for each 1/3 of a Spinco Share so issued that is equal to the exercise price under the Vizsla Silver Warrant multiplied by the fair market value of 1/3 of a Spinco Share Warrant at the Effective Time divided by the total of the fair market value of one New Vizsla Silver Share and 1/3 of a Spinco Share at the Effective Time.

 Each issued and outstanding Vizsla Silver Class A Share outstanding on the Effective Date will be exchanged for: (i) one New Vizsla Silver Share; (ii) 1/3 of a Spinco Share; and (iii) 1/3 of a Spinco Warrant. The holders of the Vizsla Silver Class A Shares will be removed from the central securities register of Vizsla Silver as the holders of such and will be added to the central securities register of Vizsla Silver as the holders of the number of New Vizsla Silver Shares that they have received on the exchange set forth in the Plan of Arrangement, and the Spinco Shares and Spinco Warrants transferred to the then holders of the Vizsla Silver Class A Shares will be registered in the name of the former holders of the Vizsla Silver Class A Shares and Vizsla Silver will provide Spinco and its registrar and transfer agent notice to make the appropriate entries in the central securities register of Spinco.

 All of the issued Vizsla Silver Class A Shares will be cancelled with the appropriate entries being made in the central securities register of Vizsla Silver, and the aggregate paid-up capital (as that term is used for purposes of the Tax Act) of the New Vizsla Silver Shares will be equal to that of the Vizsla Silver Shares immediately prior to the Effective Time less the fair market value of the Spinco Shares distributed pursuant to section 3.1(f) of the Plan of Arrangement.

 The Vizsla Silver Class A Shares, none of which will be issued or outstanding once the steps in section 3.1(f) to section 3.1(g) of the Plan of Arrangement are completed, will be cancelled and the authorized share structure of Vizsla Silver will be changed by eliminating the Vizsla Silver Class A Shares.

 Vizsla Silver's Notice of Articles will be amended to reflect the above alterations to its share structure.

No fractional Spinco Shares or Spinco Warrants will be distributed to the Vizsla Silver Shareholders and no fractional Spinco Options will be distributed to the holders of Vizsla Silver Options, and, as a result, all fractional amounts arising under the Arrangement will be rounded down to the next whole number without any compensation therefor. Any Spinco Shares and Spinco Warrants not distributed as a result of so rounding down will be cancelled by Spinco. Vizsla Silver expects to retain approximately a 55% ownership interest in Spinco upon completion of the Arrangement. Such interest is expected to be diluted if Spinco completes the Post-Closing Steps. There is no guarantee that such steps will be completed on the proposed terms, or at all.

For greater certainty, the Vizsla Silver Rights Plan will not apply in respect of the Arrangement, the transactions contemplated thereunder or to Spinco or the Spinco Shares issued in connection with the Arrangement. Pursuant to the terms of the Vizsla Silver Rights Plan from and after the Effective Time, the Vizsla Silver Rights Plan will automatically apply to the New Vizsla Silver Shares.

The effect of the Arrangement can be summarized by the following diagrams:


Structure immediately prior to the Arrangement:

Structure following completion of the Arrangement (prior to completion of the Post-Closing Steps and the exercise of any Spinco Warrants):


AUTHORITY OF THE BOARD

By passing the Arrangement Resolution, the Shareholders will also be giving authority to the Board to use its judgment to proceed with and cause Vizsla Silver to complete the Arrangement or to abandon the Arrangement without any requirement to seek or obtain any further approval of the Shareholders.

The Arrangement Resolution also provides that the terms of the Plan of Arrangement may be amended by the Board before or after the Meeting without further notice to Shareholders, unless directed by the Court. Although the Board has no current intention to amend the terms of the Plan of Arrangement, it is possible that the Board may determine that certain amendments are appropriate, necessary or desirable.

CONDITIONS TO THE ARRANGEMENT

The Arrangement Agreement provides that the consummation of the Arrangement will be subject to the fulfilment or waiver of certain conditions, including the following:

 the Interim Order will have been granted in form and substance satisfactory to Vizsla Silver;

 the Arrangement Resolution will have been approved by the requisite majority of Shareholders at the Meeting;

 the Final Order will have been obtained in form and substance satisfactory to each of Vizsla Silver and Spinco;

 the TSXV will have conditionally approved the Arrangement, including the listing of the Vizsla Silver Class A Shares in substitution for the Vizsla Silver Shares, the delisting of the Vizsla Silver Class A Shares and, in substitution therefor, the listing of the New Vizsla Silver Shares issuable under the Arrangement, as of the Effective Date, subject to compliance with the requirements of the TSXV;

 all other consents, orders, regulations and approvals, including regulatory and judicial approvals and orders, required, necessary or desirable for the completion of the Arrangement will have been obtained or received, each in form acceptable to each of Vizsla Silver and Spinco;

 there will not be in force any order or decree restraining or enjoining the consummation of the transactions contemplated by the Plan of Arrangement;

 no law, regulation or policy will have been proposed, enacted, promulgated or applied which interferes or is inconsistent with the completion of the Arrangement and Plan of Arrangement, including any material change to the income tax laws of Canada, which would reasonably be expected to have a material adverse effect on any of Vizsla Silver, the Shareholders or Spinco if the Arrangement if completed;

 Shareholders will not have exercised Dissent Rights with respect to greater than 5% of the outstanding Vizsla Silver Shares;

 the New Vizsla Silver Shares, Spinco Shares and Spinco Warrants to be issued to Shareholders in the United States under the Arrangement will be exempt from the registration requirements of the 1933 Act pursuant to Section 3(a)(10) thereof (or will otherwise be exempt from, or not subject to, registration requirements); and

 the Arrangement Agreement will not have been terminated as provided for therein.

If any of the conditions set forth in the Arrangement Agreement are not fulfilled or performed, on or prior to the Effective Time, Vizsla Silver may terminate the Arrangement Agreement or waive, in its discretion, the applicable condition in whole or in part. As soon as practicable after the fulfilment (or waiver) of the conditions contained in the Arrangement Agreement, the Board intends to cause a copy of the Final Order to be filed with the Registrar under the BCBCA, together with such other material as may be required by the Registrar in order that the Arrangement will become effective.


Management of Vizsla Silver expects that any material consents, orders and approvals required for the completion of the Arrangement will be obtained prior to the Effective Date in the ordinary course upon application therefor.

COURT APPROVAL OF THE ARRANGEMENT

The Arrangement requires the approval of the Court under the BCBCA. Prior to mailing this Circular, Vizsla Silver obtained the Interim Order authorizing the calling and holding of the Meeting and providing for certain other procedural matters. The Interim Order is attached as Schedule "D". The Notice of Hearing for Final Order in respect of the Final Order is attached as Schedule "E".

Assuming approval of the Arrangement Resolution by the Shareholders at the Meeting, Vizsla Silver intends to make an application to the Court for the Final Order on June 19, 2024 at 9:45 am (Vancouver time) or as soon thereafter as counsel may be heard at the Court house at 800 Smithe Street, Vancouver, British Columbia or at any other date and time as the Court may direct. At the hearing, any Shareholder or other interested party who wishes to participate or be represented or present arguments or evidence must file and serve a response to petition no later than 4:00 p.m. (Vancouver time) on June 17, 2024 along with any other documents required, all as set out in the Interim Order and Notice of Hearing for Final Order, copies of which are attached as Schedule "D" and "E", respectively, and satisfy any other requirement of the Court.

The Court has broad discretion under the BCBCA when making orders in respect of arrangements, and the Court may approve the Arrangement as proposed or as amended in any manner the Court may direct, subject to compliance with such terms and conditions, if any, as the Court thinks appropriate. The Court, in hearing the application for the Final Order, will consider, among other things, the fairness of the terms and conditions of the Arrangement to Shareholders. The Court will be advised prior to the hearing for the Final Order that if the terms and conditions of the Arrangement are approved by the Court, such approval will be relied upon in seeking an exemption from the registration requirements of the 1933 Act, pursuant to Section 3(a)(10) thereof, with respect to the offer and sale of the securities to be issued or distributed pursuant to the Arrangement.

For further information regarding the Court hearing and your rights in connection with the Court hearing, see the Notice of Hearing for Final Order attached as Schedule "D" to this Circular. The Notice of Hearing for Final Order constitutes notice of the Court hearing of the application for the Final Order and is your only notice of the Court hearing.

SHAREHOLDER APPROVAL OF THE ARRANGEMENT

Subject to any further order(s) of the Court, the Arrangement must be approved by at least 66⅔% of the votes cast by Shareholders present, in person or by proxy, and entitled to vote at the Meeting. The Arrangement is not subject to the minority approval requirements of MI 61-101.

In the absence of any instruction to the contrary, the Vizsla Silver Shares represented by proxies appointing the management designees named in the form of proxy will be voted in favour of the Arrangement Resolution.

PROPOSED TIMETABLE FOR THE ARRANGEMENT

The anticipated timetable for the completion of the Arrangement and the key dates proposed are as follows:

Special Meeting:

June 17, 2024

   

Final Court Approval:

June 19, 2024

   

Effective Date:

June 24, 2024

Notice of the actual Effective Date will be made through one or more news releases issued by Vizsla Silver. The Board will determine and Effective Date upon satisfaction or waiver of the conditions to the Arrangement.


DISTRIBUTION OF SHARE CERTIFICATES

Concurrently with the mailing of the Circular, Vizsla Silver will mail the Letter of Transmittal to Registered Shareholders, which will be used to exchange their certificates representing Vizsla Silver Shares for certificates representing the New Vizsla Silver Shares, Spinco Shares and Spinco Warrants.

Upon the Arrangement becoming effective and surrender to the Depositary for cancellation of a certificate or other entitlement which immediately prior to the Effective Time represented outstanding Vizsla Silver Shares together with a Letter of Transmittal which has been completed and signed in the manner required thereby in respect of such certificate and such additional documents and instruments as the Depositary may reasonably require, the holder of such surrendered certificate will be entitled to receive in exchange therefor, and the Depositary will deliver to such holder, certificates or a DRS Advice representing that number (rounded down to the nearest whole number) of New Vizsla Silver Shares, Spinco Shares and Spinco Warrants that such holder has the right to receive pursuant to the Plan of Arrangement and the surrendered certificate will be cancelled. A Letter of Transmittal accompanies this Circular.

Until exchanged, each certificate representing Vizsla Silver Shares will, after the Effective Time, represent only the right to receive, upon surrender, certificates representing the requisite numbers of New Vizsla Silver Shares, Spinco Shares and Spinco Warrants. Shareholders will not receive any fractional Spinco Shares or Spinco Warrants.

Any fractional Spinco Shares or Spinco Warrants will be rounded down to the nearest whole number and Shareholders will not receive any compensation in lieu thereof.

CANCELLATION OF RIGHTS AFTER SIX YEARS

Any certificate which immediately prior to the Effective Time represented Vizsla Silver Shares and which has not been surrendered with all other documents required by the Depositary, on or prior to the sixth anniversary of the Effective Date, will cease to represent any claim against or interest of any kind or nature in either Vizsla Silver or Spinco. Accordingly, persons who tender certificates for Vizsla Silver Shares after the sixth anniversary of the Effective Date will not receive New Vizsla Silver Shares, Spinco Shares or Spinco Warrants, will not own any interest in Vizsla Silver or Spinco and will not be paid any cash or other compensation in lieu thereof.

EXPENSES OF THE ARRANGEMENT

The costs relating to the Arrangement, including, without limitation, financial advisory, accounting and legal fees, will be borne by Vizsla Silver.

SPINCO WARRANTS

The following is a summary of the principal attributes of the Spinco Warrants and refers to the Spinco Warrant Indenture mentioned hereunder. Such summary does not purport to be complete and is qualified in its entirety by reference to the provisions of the Spinco Warrant Indenture in the form to be agreed upon by the parties. A copy of the Spinco Warrant Indenture may be obtained on request from the Corporate Secretary of Spinco and will be available electronically on SEDAR+.

While Spinco has made an application with the TSXV to list the Spinco Warrants, there is no guarantee when, or if, such listing will be completed. Such listing will be subject to Spinco fulfilling all of the listing requirements of the TSXV.

Each whole Spinco Warrant will be transferable and entitle its holder, upon the payment of the exercise price of $0.05 per share, to acquire one Spinco Share. As soon as practicable after the Effective Date, Vizsla Silver will deliver such number of Spinco Warrants as is equal to 1/3 of a Spinco Warrant for each outstanding Vizsla Silver Share. The Spinco Warrants may be exercised until the date which is the earlier of: (i) 120 days after the Listing Date; and (ii) December 31, 2025. Certificates representing Spinco Warrants will be issued through a book-based system.

The Spinco Warrants will be governed by the Spinco Warrant Indenture, which may be amended or supplemented, from time to time. Spinco expects to designate Computershare Trust Company of Canada, at its principal offices in Vancouver and Toronto, as agent for the Spinco Warrants where the Spinco Warrants can be surrendered for exercise, transfer or exchange. Prior to the Effective Date, Spinco may name any other agent with respect to the Spinco Warrants.


The Spinco Warrant Indenture will provide for adjustment in the number of Spinco Shares issuable upon the exercise of Spinco Warrants and/or the exercise price per Spinco Share upon the occurrence of certain events, as will be outlined in the Spinco Warrant Indenture.

Spinco will covenant in the Spinco Warrant Indenture that, during the period in which the Spinco Warrants are exercisable, Spinco will give notice to the agent and the Spinco Warrantholders of certain stated events, including events that would result in an adjustment to the exercise price for the Spinco Warrants or the number of Spinco Shares issuable upon exercise of the Spinco Warrants of such event, if any.

No fraction of a Spinco Share will be issued upon the exercise of a Spinco Warrant and no cash payment will be made in lieu thereof. Spinco Warrantholders are not entitled to any voting rights or pre-emptive rights or any other rights conferred upon a person as a result of being a holder of Spinco Shares.

The Spinco Warrant Indenture will provide that, from time to time, Spinco may amend or supplement the Spinco Warrant Indenture for certain purposes, without the consent of the holders of the Spinco Warrants, including curing defects or inconsistencies or making any change that does not prejudice the rights of any holder. Any amendment or supplement to the Spinco Warrant Indenture that would prejudice the interests of the holders of Spinco Warrants would require approval of the Spinco Warrantholders.

The Spinco Warrants will not be exercisable by or on behalf of a person in the United States or a U.S. Person, nor will certificates representing the Spinco Shares issuable upon exercise of the Spinco Warrants be registered or delivered to an address in the United States, unless an exemption from registration under the 1933 Act and any applicable state securities laws is available and Spinco receives an opinion of counsel of recognized standing to such effect in form and substance reasonably satisfactory to Spinco.

RISK FACTORS RELATING TO THE ARRANGEMENT

The following risk factors should be considered by Shareholders in evaluating whether to approve the Arrangement. These risk factors should be considered in conjunction with the other information included in this Circular and the risk factors disclosed under the heading "Risk Factors" in Schedules "G" and "L".

TERMINATION OF THE ARRANGEMENT AGREEMENT OR FAILURE TO OBTAIN REQUIRED APPROVALS

Each of Vizsla Silver and Spinco has the right to terminate the Arrangement Agreement in certain circumstances. Accordingly, there is no certainty, nor can Vizsla Silver provide any assurance, that the Arrangement Agreement will not be terminated before the completion of the Arrangement. In addition, the completion of the Arrangement is subject to a number of conditions, certain of which are outside the control of Vizsla Silver, including Shareholders approving the Arrangement and required regulatory approvals, including of the Court, being obtained. There is no certainty, nor can Vizsla Silver provide any assurance, that these conditions will be satisfied. If for any reason the Arrangement is not completed, the market price of Vizsla Silver Shares may be adversely affected and Shareholders will lose the prospective benefits of the Arrangement. Moreover, if the Arrangement Agreement is terminated, there is no assurance that Vizsla Silver will pursue or be able to complete an alternative transaction to spin-out the Royalty, and Shareholders will continue to be subject to the risk factors of both Vizsla Silver and Spinco as disclosed in this Circular.

MARKET PRICE OF THE VIZSLA SILVER SHARES MAY FLUCTUATE

If the Arrangement Resolution is not approved by the Shareholders or, even if the Arrangement Resolution is approved, the market price of the Vizsla Silver Shares may decline to the extent that the current market price of the Vizsla Silver Shares reflects a market assumption that the Arrangement will be completed or to the extent the current market price of the Vizsla Silver Shares reflects the value associated with Spinco, as applicable.


SPINCO SHARES AND SPINCO WARRANTS NOT LISTED ON STOCK EXCHANGE

While Spinco has made an application with the TSXV to list the Spinco Shares and Spinco Warrants, there is no guarantee when, or if, such listings will be completed. Such listings will be subject to Spinco fulfilling all of the listing requirements of the TSXV. Until the Spinco Shares are listed on a stock exchange, Spinco Shareholders and Spinco Warrantholders may not be able to sell their Spinco Shares or Spinco Warrants. Even if a listing is obtained, the holding of Spinco Shares and Spinco Warrants will involve a high degree of risk and should be undertaken only by investors whose financial resources are sufficient to enable them to assume such risks and who have no need for immediate liquidity of their investment.

SPINCO HAS LIMITED FINANCIAL RESOURCES

Spinco presently does not have sufficient financial resources to undertake all of its currently planned activities beyond completion of the Arrangement. In the event that the Arrangement is completed, Spinco will need to obtain further financing, whether through debt financing, equity financing or other means. There can be no assurance that Spinco will be able to raise the balance of the financing required or that such financing can be obtained without substantial dilution to its shareholders. Failure to obtain additional financing on a timely basis could cause Spinco to reduce or terminate its operations.

SPINCO SHARES AND SPINCO WARRANTS WILL NOT BE "QUALIFIED INVESTMENTS"

The Spinco Shares and Spinco Warrants distributed to Shareholders pursuant to the Arrangement will not qualify as "qualified investments" under the Tax Act for Registered Plans or a DPSP unless (i) on or before Spinco's filing due date for its first taxation year, the Spinco Shares are listed on a "designated stock exchange" as defined in the Tax Act (or Spinco otherwise satisfies the conditions to be a "public corporation" for purposes of the Tax Act) and Spinco validly elects to be a "public corporation" for purposes of the Tax Act from the commencement of its first taxation year, and (ii) in case of the Spinco Warrants, neither Spinco, nor any person with whom Spinco does not deal at arm's length, is an annuitant, a beneficiary, an employer or a subscriber under, or a holder of a particular Registered Plan or a DPSP. No assurance can be given as to whether Spinco will qualify as a "public corporation".

Where a Registered Plan acquires a Spinco Share or Spinco Warrant in circumstances where the Spinco Shares or Spinco Warrants are not a qualified investment under the Tax Act for the Registered Plan, adverse tax consequences may arise for the Registered Plan and the Controlling Individual of the Registered Plan, including that the Registered Plan or the Controlling Individual of the Registered Plan may become subject to penalty taxes.

See "Material Canadian Federal Income Tax Considerations - Holders Resident in Canada - Eligibility for Investment - New Vizsla Silver Shares, Spinco Shares and Spinco Warrants".

SPINCO FINANCING

There is no assurance that Spinco will complete the Spinco Financing. If such financing is not completed, Spinco may not meet the initial listing requirements of the TSXV.

INCOME TAX

The Arrangement may give rise to adverse tax consequences to Shareholders, and each Shareholder is urged to consult with his, her or its own tax advisor. See "Material Income Tax Considerations".

COSTS OF THE ARRANGEMENT

There are certain costs related to the Arrangement, such as legal and accounting fees incurred, that must be paid even if the Arrangement is not completed.

EXERCISE OF DISSENT RIGHTS

Registered Shareholders have the right to exercise Dissent Rights and demand payment equal to the fair value of their Vizsla Silver Shares in cash. If Dissent Rights are exercised in respect of a significant number of Vizsla Silver Shares, a substantial cash payment may be required to be made to such Shareholders, which could have an adverse effect on Vizsla Silver's financial condition and cash resources. Vizsla Silver may elect, in its sole discretion, not to complete the Arrangement if a significant number of Shareholders exercise Dissent Rights.


DISSENT RIGHTS

The following is a summary of the provisions of the BCBCA relating to a Shareholder's dissent and appraisal rights in respect of the Arrangement Resolution. Such summary is not a comprehensive statement of the procedures to be followed by a Dissenting Shareholder who seeks payment of the fair value of its Vizsla Silver Shares and is qualified in its entirety by reference to the full text of sections 237 to 247 of the BCBCA, as modified by the Plan of Arrangement, the Interim Order and the Final Order (collectively, the "Dissent Procedures").

The statutory provisions dealing with the right of dissent are technical and complex. Any Dissenting Shareholders should seek independent legal advice, as failure to comply strictly with the provisions of sections 237 to 247 of the BCBCA, which is attached to this Circular as Schedule "F", as modified by the Plan of Arrangement, the Interim Order and the Final Order, may result in the loss of all Dissent Rights.

The Interim Order expressly provides Registered Shareholders with the right to dissent with respect to the Arrangement Resolution. Each Dissenting Shareholder is entitled to be paid the fair value (determined as of the close of business on the day before the Effective Date of all but not less than all, of the holder's Vizsla Silver Shares), provided that the holder duly dissents to the Arrangement Resolution and the Arrangement becomes effective.

In many cases, Vizsla Silver Shares beneficially owned by a holder are registered either (a) in the name of an Intermediary that the Non-Registered Shareholder deals with in respect of such shares, such as, among others, banks, trust companies, securities brokers, trustees and other similar entities, or (b) in the name of a depositary, such as CDS & Co., of which the Intermediary is a participant. Accordingly, a Non-Registered Shareholder will not be entitled to exercise his, her or its rights of dissent directly (unless the Vizsla Silver Shares are re-registered in the Non-Registered Shareholder's name).

With respect to Vizsla Silver Shares in connection to the Arrangement, pursuant to the Interim Order, a Registered Shareholder may exercise rights of dissent under Division 2 of Part 8 of the BCBCA, as modified by the Plan of Arrangement, the Interim Order and the Final Order, provided that, notwithstanding section 242(2) of the BCBCA, the written objection to the Arrangement Resolution must be sent to Vizsla Silver c/o Forooghian + Company Law Corporation, Suite 401 - 353 Water Street, Vancouver, British Columbia, Canada, V6B 1B8, Attention: Farzad Forooghian, by not later than 10:00 a.m. (Vancouver time) on June 13, 2024, or two Business Days prior to any adjournment or postponement of the Meeting.

To exercise Dissent Rights, a Shareholder must dissent with respect to all Vizsla Silver Shares of which it is the registered and beneficial owner. A Registered Shareholder who wishes to dissent must deliver written notice of dissent ("Notice of Dissent") to Vizsla Silver as set forth above and such Notice of Dissent must strictly comply with the requirements of section 242 of the BCBCA. Any failure by a Shareholder to fully comply with the provisions of the BCBCA, as modified by the Plan of Arrangement, the Interim Order and the Final Order, may result in the loss of that holder's Dissent Rights. Non-Registered Shareholders who wish to exercise Dissent Rights must cause each Registered Shareholder holding their Vizsla Silver Shares to deliver the Notice of Dissent, or, alternatively, make arrangements to become a Registered Shareholder.

To exercise Dissent Rights, a Registered Shareholder must prepare a separate Notice of Dissent for himself, herself or itself, if dissenting on his, her or its own behalf, and for each other Non-Registered Shareholder who beneficially owns Vizsla Silver Shares registered in the Shareholder's name and on whose behalf the Shareholder is dissenting; and must dissent with respect to all of the Vizsla Silver Shares registered in his, her or its name or if dissenting on behalf of a Non-Registered Shareholder, with respect to all of the Vizsla Silver Shares registered in his, her or its name and beneficially owned by the Non-Registered Shareholder on whose behalf the Shareholder is dissenting. The Notice of Dissent must set out the number of Vizsla Silver Shares in respect of which the Dissent Rights are being exercised (the "Notice Shares") and: (a) if such Vizsla Silver Shares constitute all of the Vizsla Silver Shares of which the Shareholder is the registered and beneficial owner and the Shareholder owns no other Vizsla Silver Shares beneficially, a statement to that effect; (b) if such Vizsla Silver Shares constitute all of the Vizsla Silver Shares of which the Shareholder is both the registered and beneficial owner, but the Shareholder owns additional Vizsla Silver Shares beneficially, a statement to that effect and the names of the Registered Shareholders, the number of Vizsla Silver Shares held by each such Registered Shareholder and a statement that written notices of dissent are being or have been sent with respect to such other Vizsla Silver Shares; or (c) if the Dissent Rights are being exercised by a Registered Shareholder who is not the beneficial owner of such Vizsla Silver Shares, a statement to that effect and the name of the Non-Registered Shareholder and a statement that the Registered Shareholder is dissenting with respect to all Vizsla Silver Shares of the Non-Registered Shareholder registered in such registered holder's name.


If the Arrangement Resolution is approved by Shareholders, and Vizsla Silver notifies a registered holder of Notice Shares of Vizsla Silver's intention to act upon the Arrangement Resolution pursuant to section 243 of the BCBCA, in order to exercise Dissent Rights such Shareholder must, within one month after Vizsla Silver gives such notice, send to Vizsla Silver a written notice that such holder requires the purchase of all of the Notice Shares in respect of which such holder has given Notice of Dissent. Such written notice must be accompanied by the certificate or certificates representing those Notice Shares (including a written statement prepared in accordance with section 244(1)(c) of the BCBCA if the dissent is being exercised by the Shareholder on behalf of a Non-Registered Shareholder), whereupon, subject to the provisions of the BCBCA relating to the termination of Dissent Rights, the Shareholder becomes a Dissenting Shareholder, and is bound to sell and Vizsla Silver is bound to purchase those Vizsla Silver Shares. Such Dissenting Shareholder may not vote, or exercise or assert any rights of a Shareholder in respect of such Notice Shares, other than the rights set forth in Division 2 of Part 8 of the BCBCA, as modified by the Plan of Arrangement, the Interim Order and the Final Order. A vote against the Arrangement Resolution, an abstention, or the execution of a proxy to vote against the Arrangement Resolution, does not constitute a Dissent Notice.

Dissenting Shareholders who are:

(a) ultimately are entitled to be paid fair value for their Vizsla Silver Shares, will be entitled to be paid the fair value of such Vizsla Silver Shares, and will not be entitled to any other payment or consideration, including any payment that would be payable under the Arrangement had such holders not exercised their Dissent Rights in respect of such Vizsla Silver Shares; or

(b) ultimately are not entitled, for any reason, to be paid fair value for such Vizsla Silver Shares will be deemed to have participated in the Arrangement on the same basis as a non-dissenting holder of Vizsla Silver Shares; but in no case will Vizsla Silver be required to recognize such persons as holding Vizsla Silver Shares on or after the Effective Date.

If a Dissenting Shareholder is ultimately entitled to be paid for their Dissent Shares, such Dissenting Shareholder may enter into an agreement for the fair value of such Dissent Shares. If such Dissenting Shareholder does not reach an agreement, such Dissenting Shareholder, or Vizsla Silver, may apply to the Court, and the Court may determine the payout value of the Dissent Shares and make consequential orders and give directions as the Court considers appropriate. There is no obligation on Vizsla Silver to make an application to the Court. The Dissenting Shareholder will be entitled to receive the fair value that the Vizsla Silver Shares had as of the close of business on the day before the Effective Date. After a determination of the fair value of the Dissent Shares, Vizsla Silver must then promptly pay that amount to the Dissenting Shareholder.

In no case will Vizsla Silver, the Depositary or any other person be required to recognize Dissenting Shareholders as Shareholders after the Effective Time, and the names of such Dissenting Shareholders will be deleted from the central securities register as Shareholders at the Effective Time.

In no circumstances will Vizsla Silver or any other person be required to recognize a person as a Dissenting Shareholder: (i) unless such person is the holder of the Vizsla Silver Shares in respect of which Dissent Rights are purported to be exercised immediately prior to the Effective Time; (ii) if such person has voted or instructed a proxy holder to vote such Notice Shares in favour of the Arrangement Resolution; or (iii) unless such person has strictly complied with the procedures for exercising Dissent Rights set out in Division 2 of Part 8 of the BCBCA, as modified by the Plan of Arrangement, the Interim Order and the Final Order and does not withdraw such Notice of Dissent prior to the Effective Time.

Dissent Rights with respect to Notice Shares will terminate and cease to apply to the Dissenting Shareholder if, before full payment is made for the Notice Shares, the Arrangement in respect of which the Notice of Dissent was sent is abandoned or by its terms will not proceed, a court permanently enjoins or sets aside the corporate action approved by the Arrangement Resolution, or the Dissenting Shareholder withdraws the Notice of Dissent with Vizsla Silver's written consent. If any of these events occur, Vizsla Silver must return the share certificates or DRS statements representing the Vizsla Silver Shares to the Dissenting Shareholder and the Dissenting Shareholder regains the ability to vote and exercise its rights as a Shareholder.


If you dissent there can be no assurance that the amount you receive as fair value for your Vizsla Silver Shares will be more than or equal to the Consideration under the Arrangement.

Each Shareholder wishing to avail himself, herself or itself of the Dissent Rights should carefully consider and comply with the provisions of the Interim Order and sections 237 to 247 of the BCBCA, which are attached to this Circular as Schedules "D" and "F", respectively, and seek his, her or its own legal advice.

The Arrangement Agreement provides that, unless otherwise waived, it is a condition to the obligations of Vizsla Silver and Spinco to complete the Arrangement that, on or before the Effective Date, holders of not more than an aggregate of 5% of the issued and outstanding Vizsla Silver Shares will have exercised Dissent Rights. If the number of outstanding Vizsla Silver Shares in respect of which Dissent Rights have been exercised exceeds 5%, the Arrangement will not proceed unless Vizsla Silver waives such condition.

The above is only a summary of the Dissent Procedures which are technical and complex. If you are a Registered Shareholder and wish to exercise your Dissent Rights, you should seek your own legal advice as failure to strictly comply with the Dissent Procedures, will result in the loss of your Dissent Rights. For a general summary of material Canadian income tax implications to a Dissenting Shareholder, see "Material Income Tax Considerations - Material Canadian Federal Income Tax Considerations - Holders Resident in Canada - Dissenting Resident Holders" and "Material Income Tax Considerations - Material Canadian Federal Income Tax Considerations - Holders Not Resident in Canada - Dissenting Non-Resident Holders".

CERTAIN SECURITIES LAW MATTERS

The following discussion is only a general overview of certain requirements of Canadian and U.S. securities laws applicable to trades in securities of Vizsla Silver or Spinco. All holders of securities are urged to consult with their own legal counsel to ensure that any resale of their securities of Vizsla Silver or Spinco complies with applicable securities legislation.

CANADIAN SECURITIES LAWS

Vizsla Silver is a reporting issuer in each of the provinces and territories in Canada. The Vizsla Silver Shares currently trade on the TSXV in Canada. After the Arrangement, Spinco will be a reporting issuer in each of the provinces and territories in Canada. While Spinco has made an application with the TSXV to list the Spinco Shares and Spinco Warrants, there is no guarantee when, or if, such listings will be completed. Such listings will be subject to Spinco fulfilling all of the listing requirements of the TSXV.

The distribution of the Spinco Shares and Spinco Warrants pursuant to the Arrangement will constitute a distribution of securities which is exempt from prospectus requirements of Canadian securities legislation. With certain exceptions, the Spinco Shares and Spinco Warrants may generally be resold in each of the provinces of Canada provided the trade is not a "control distribution" as defined in National Instrument 45-102 - Resale of Securities, no unusual effort is made to prepare the market or create a demand for those securities, no extraordinary commission or consideration is paid to a person or company in respect of the trade and, if the selling security holder is an insider or officer of Spinco, the insider or officer has no reasonable grounds to believe that Spinco is in default of securities legislation.

U.S. SECURITIES LAWS

The New Vizsla Silver Shares, Spinco Shares and Spinco Warrants issued or deemed to be issued to Shareholders in the United States pursuant to the Arrangement will not be registered under the 1933 Act or the securities laws of any state of the United States, and will be distributed in reliance upon the exemption from registration under the 1933 Act provided by Section 3(a)(10) thereof and available exemptions from applicable state registration requirements. Section 3(a)(10) of the 1933 Act provides an exemption from registration under the 1933 Act for offers and sales of securities issued in exchange for one or more outstanding securities where the terms and conditions of the issuance and exchange of such securities have been approved by a court authorized to grant such approval after a hearing upon the fairness of the terms and conditions of the issuance and exchange at which all persons to whom the securities will be issued have the right to appear. The Court is authorized to conduct a hearing at which the fairness of the terms and conditions of the Arrangement will be considered. The Court issued the Interim Order on May 15, 2024 and, subject to the approval of the Arrangement by the Shareholders at the Meeting, it is expected that a hearing on the Arrangement will be held on June 19, 2024 at 9:45 am (Vancouver time), or as soon thereafter as counsel may be heard, at the Law Courts, 800 Smithe Street, Vancouver, British Columbia. All Shareholders are entitled to appear and be heard at this hearing. The Final Order will constitute a basis for the exemption from the registration requirements of the 1933 Act provided by Section 3(a)(10) thereof with respect to the New Vizsla Silver Shares, Spinco Shares and Spinco Warrants to be issued pursuant to the Arrangement. Prior to the hearing on the Final Order, the Court will be informed of this effect of the Final Order.


The New Vizsla Silver Shares, Spinco Shares and Spinco Warrants to be received by Shareholders in the United States pursuant to the Arrangement will be freely transferable under U.S. federal securities laws except by persons who are "affiliates" (as defined in Rule 405 of the 1933 Act) of Vizsla Silver or Spinco, as applicable, after the Effective Date or were "affiliates" of Vizsla Silver or Spinco, as applicable, within 90 days prior to the date of any proposed resale. Persons who may be deemed to be "affiliates" of an issuer include individuals or entities that control, are controlled by, or are under common control with, the issuer, whether through the ownership of voting securities, by contract, or otherwise, and generally include executive officers and directors of the issuer as well as principal shareholders of the issuer. Any resale of such securities by such an affiliate (or former affiliate) may be subject to the registration requirements of the 1933 Act, absent an exemption therefrom.

Such affiliates (and former affiliates) may resell New Vizsla Silver Shares, Spinco Shares and Spinco Warrants pursuant to Rule 144, if available. In addition, subject to certain limitations, any such affiliates (and former affiliates) who is an affiliate (or former affiliate) solely by virtue of being an executive officer or director of Vizsla Silver or Spinco, as applicable may resell such securities outside the United States without registration under the 1933 Act pursuant to Regulation S under the 1933 Act.

RESALES BY AFFILIATES PURSUANT TO RULE 144

In general, under Rule 144, persons who are, or are selling for the account of, affiliates of Vizsla Silver or Spinco after the Arrangement, as applicable, will be entitled to sell in the United States, during any three-month period, a portion of the New Vizsla Silver Shares, Spinco Shares or Spinco Warrants that they receive in connection with the Arrangement, provided that the number of such securities sold does not exceed the certain volume restrictions and subject to specified restrictions on manner of sale, notice requirements, aggregation rules and the availability of current public information about Vizsla Silver and Spinco, as applicable.

RESALE OF SECURITIES PURSUANT TO REGULATION S

In general, pursuant to Regulation S under the 1933 Act, if at the Effective Date Vizsla Silver and Spinco, as applicable, are each a "foreign private issuer" (as defined in Rule 405 of the 1933 Act), persons who are "affiliates" (as defined in Rule 405 of the 1933 Act) of Vizsla Silver or Spinco, as applicable, after the Effective Date, or were "affiliates" of Vizsla Silver or Spinco, as applicable, within 90 days prior to the date of the proposed resale, solely by virtue of their status as an executive officer or director of Vizsla Silver or Spinco, as applicable, may sell their New Vizsla Silver Shares, Spinco Shares or Spinco Warrants, as applicable, received under the Arrangement outside the United States in an "offshore transaction" (as defined in Regulation S under the 1933 Act) if none of the seller, an affiliate or any person acting on their behalf engages in "directed selling efforts" (as defined in Regulation S under the 1933 Act) in the United States with respect to such securities and provided that no selling concession, fee or other remuneration is paid in connection with such sale other than the usual and customary broker's commission that would be received by a person executing such transaction as agent. For purposes of Regulation S under the 1933 Act, "directed selling efforts" means any activity undertaken for the purpose of, or that could reasonably be expected to have the effect of, conditioning the market in the United States for any of the securities being offered. Also, for purposes of Regulation S under the 1933 Act, an offer or sale of securities is made in an "offshore transaction" if the offer is not made to a person in the United States and either (a) at the time the buy order is originated, the buyer is outside the United States, or the seller reasonably believes that the buyer is outside of the United States, or (b) the transaction is executed in, on or through the facilities of a "designated offshore securities market" (as defined in Regulation S under the 1933 Act), (which would include a sale through the TSX-V), and neither the seller nor any person acting on its behalf knows that the transaction has been pre-arranged with a buyer in the United States. Certain additional restrictions under Regulation S of the 1933 Act are applicable to sales outside the United States by a holder of New Vizsla Silver Shares, Spinco Shares or Spinco Warrants who is an "affiliate" of Vizsla Silver or Spinco, as applicable, after the Effective Date, or was an "affiliate" of Vizsla Silver or Spinco, as applicable, within 90 days prior to the date of the proposed resale, other than by virtue of his status as an officer or director of Vizsla Silver or Spinco, as applicable.


As a practical matter, the availability of Regulation S for resales of the New Vizsla Silver Shares, Spinco Shares and Spinco Warrants may depend in part upon whether Vizsla Silver or Spinco, as applicable, maintains a listing for such securities on a Canadian securities exchange.

EXERCISE OF SPINCO WARRANTS AND RE-SALE OF SPINCO SHARES ISSUABLE THERETO

The Spinco Shares issuable upon exercise of the Spinco Warrants may not be issued in reliance upon the exemption from registration provided by Section 3(a)(10) of the 1933 Act and the Spinco Warrants may be exercised only pursuant to an available exemption from the registration requirements of the 1933 Act and applicable state securities laws. Prior to the issuance of securities pursuant to any such exercise after the Effective Time, Spinco may require evidence (which may include in an opinion of counsel) reasonably satisfactory to Spinco to the effect that the issuance of such securities does not require registration under the 1933 Act or applicable state securities laws.

The Spinco Shares received upon exercise of the Spinco Warrants after the Effective Time by holders in the United States or who are U.S. Persons will be "restricted securities", as such term is defined in Rule 144(a)(3) under the 1933 Act, and may not be resold unless such securities are registered under the 1933 Act and all applicable state securities laws or unless an exemption from such registration requirements is available. Subject to certain limitations, any Spinco Shares issuable upon the exercise of Spinco Warrants may be resold outside the United States without registration under the 1933 Act pursuant to Regulation S in an "offshore transaction" (as such term is defined in Regulation S) over the TSX-V.

The foregoing discussion is only a general overview of certain requirements of the 1933 Act applicable to the resale of the securities issued or deemed to be issued to Shareholders pursuant to the Arrangement. All holders of such securities are urged to consult with counsel to ensure that the resale of their securities complies with applicable securities legislation.

MATERIAL INCOME TAX CONSIDERATIONS

THE TAX CONSEQUENCES OF THE ARRANGEMENT MAY VARY DEPENDING UPON THE PARTICULAR CIRCUMSTANCES OF EACH SHAREHOLDER AND OTHER FACTORS. ACCORDINGLY, SHAREHOLDERS ARE URGED TO CONSULT THEIR OWN TAX ADVISORS TO DETERMINE THE PARTICULAR TAX CONSEQUENCES TO THEM OF THE ARRANGEMENT.

MATERIAL CANADIAN FEDERAL INCOME TAX CONSIDERATIONS

The following summarizes material Canadian federal income tax considerations under the Tax Act generally applicable to Shareholders in respect of the disposition of Vizsla Silver Shares pursuant to the Arrangement, and the acquisition, holding, and disposition of New Vizsla Silver Shares, Spinco Shares and Spinco Warrants acquired pursuant to the Arrangement.

Comment is restricted to Shareholders who, for purposes of the Tax Act, (i) hold their Vizsla Silver Shares, and will hold their Vizsla Silver Class A Shares, New Vizsla Silver Shares, Spinco Shares and Spinco Warrants, solely as capital property, and (ii) deal at arm's length with and are not affiliated with the Company or Spinco (each such Shareholder, a "Holder").

Generally, Vizsla Silver Shares, Vizsla Silver Class A Shares, New Vizsla Silver Shares, Spinco Shares and Spinco Warrants will be considered to be capital property to a Holder thereof provided that the Holder does not use the Vizsla Silver Shares, Vizsla Silver Class A Shares, New Vizsla Silver Shares, Spinco Shares or Spinco Warrants, as the case may be, in the course of carrying on a business of trading or dealing in securities and such Holder has not acquired such shares or warrants, as the case may be, in one or more transactions considered to be an adventure or concern in the nature of trade.


This summary does not apply to a Holder that:

(a) is a "financial institution" for the purposes of the mark-to-market rules in the Tax Act or a "specified financial institution" as defined in the Tax Act;

(b) is a person or partnership an interest in which is a "tax shelter investment" for purposes of the Tax Act;

(c) has elected to report its Canadian federal income tax results in a currency other than Canadian currency;

(d) has entered into or will enter into a "derivative forward agreement", a "synthetic disposition arrangement", or a "synthetic equity arrangement" as those terms are or are proposed to be defined in the Tax Act;

(e) receives dividends on Vizsla Silver Shares, or will receive dividends on Vizsla Silver Class A Shares, New Vizsla Silver Shares or Spinco Shares under or as part of a "dividend rental arrangement" as defined in the

Tax Act;

(f) is a "foreign affiliate" (as such term is defined in the Tax Act) of a taxpayer resident in Canada;

(g) is exempt from tax under the Tax Act;

(h) has acquired Vizsla Silver Shares, or will acquire Vizsla Silver Class A Shares, New Vizsla Silver Shares, Spinco Shares or Spinco Warrants, on the exercise of an employee stock option; or

(i) is otherwise a Holder of special status or in special circumstances.

All such Holders should consult their own tax advisors with respect to the consequences of the Arrangement.

Additional considerations, not discussed herein, may be applicable to a Holder that is a corporation resident in Canada or a corporation that does not deal at arm's length, for purposes of the Tax Act, with a corporation resident in Canada, and is, or becomes as part of a transaction or event or series of transactions or events, controlled by a non-resident person, or a group of non-resident persons not dealing with each other at arm's length, for purposes of the "foreign affiliate dumping" rules in section 212.3 of the Tax Act. Such Holders should consult their tax advisors.

In addition, this summary does not address the income tax considerations to holders of Vizsla Silver Options and Vizsla Silver Warrants.

The summary assumes that (i) the re-designation of Vizsla Silver Shares as Vizsla Silver Class A Shares, as contemplated by the Plan of Arrangement, will not, in and of itself, result in Holders being deemed to have disposed of their Vizsla Silver Shares for the purposes of the Tax Act (for purposes of this summary, Vizsla Silver Class A Shares are hereafter included in any reference to "Vizsla Silver Shares"), and (ii) the Share Exchange (as described below) will be considered to occur "in the course of a reorganization of capital" of Vizsla Silver such that section 86 of the Tax Act will apply in respect of the Share Exchange. No tax ruling or legal opinion has been sought or obtained in this regard, or with respect to any of the assumptions made throughout this summary of Material Canadian Federal Income Tax Considerations, and the summary below is qualified accordingly.

This summary is based on the current provisions of the Tax Act, the regulations thereunder (the "Regulations"), and our understanding of the current published administrative practices and policies of the CRA. This summary takes into account all specific proposals to amend the Tax Act and Regulations (the "Proposed Amendments") announced by the Minister of Finance (Canada) prior to the date hereof. It is assumed that the Proposed Amendments will be enacted as currently proposed and that there will be no other change in law or administrative or assessing practice, whether by legislative, governmental, or judicial action or decision, although no assurance can be given in these respects. If the Proposed Amendments are not enacted or otherwise implemented as presently proposed, the tax consequences may not be as described below in all cases. This summary does not take into account provincial, territorial or foreign income tax considerations, which may differ materially from the Canadian federal income tax considerations discussed below.


This summary is of a general nature only and is not and should not be construed as legal or tax advice to any particular person (including a Holder as defined above). Each person who may be affected by the Arrangement should consult the person's own tax advisors with respect to the person's particular circumstances.

HOLDERS RESIDENT IN CANADA

This portion of this summary applies only to Holders who are or are deemed to be resident solely in Canada for the purposes of the Tax Act and any applicable income tax treaty or convention (each, a "Resident Holder").

A Resident Holder whose Vizsla Silver Shares, New Vizsla Silver Shares, Spinco Shares or Spinco Warrants might not otherwise qualify as capital property may be entitled to make an irrevocable election permitted by subsection 39(4) of the Tax Act to deem such shares or warrants, and every other "Canadian security" (as defined in the Tax Act), held by such person, in the taxation year of the election and each subsequent taxation year to be capital property. Resident Holders are advised to consult their own tax advisors to determine whether such an election is available and desirable in their particular circumstances.

Exchange of Vizsla Silver Shares for New Vizsla Silver Shares, Spinco Shares and Spinco Warrants

A Resident Holder who exchanges Vizsla Silver Shares for New Vizsla Silver Shares, Spinco Shares and Spinco Warrants pursuant to the Arrangement (the "Share Exchange") will be deemed to have received a taxable dividend equal to the amount, if any, by which the aggregate fair market value of the Spinco Shares and Spinco Warrants distributed to the Resident Holder pursuant to the Share Exchange at the time of the Share Exchange exceeds the "paid-up capital" (as defined in the Tax Act) ("PUC") of the Resident Holder's Vizsla Silver Shares determined at that time. Any such taxable dividend will be taxable as described below under "Holders Resident in Canada - Taxation of Dividends - New Vizsla Silver Shares and Spinco Shares". However, the Company expects that the aggregate fair market value of Spinco Shares and Spinco Warrants distributed to a Resident Holder pursuant to the Share Exchange under the Arrangement will not exceed the PUC of the Vizsla Silver Shares to the Resident Holder. Accordingly, the Company does not expect that any Resident Holder will be deemed to receive a taxable dividend on the Share Exchange.

A Resident Holder who exchanges Vizsla Silver Shares for New Vizsla Silver Shares, Spinco Shares and Spinco Warrants on the Share Exchange will realize a capital gain equal to the amount, if any, by which the aggregate fair market value of those Spinco Shares and Spinco Warrants at the effective time of the Share Exchange, less the amount of any taxable dividend deemed to be received by the Resident Holder as described in the preceding paragraph, exceeds the "adjusted cost base" (as defined in the Tax Act) ("ACB") of the Resident Holder's Vizsla Silver Shares determined immediately before the Share Exchange. Any capital gain so realized will be taxable as described below under "Holders Resident in Canada - Taxation of Capital Gains and Capital Losses".

The Resident Holder will acquire the Spinco Shares and Spinco Warrants received on the Share Exchange at a cost equal to their respective fair market value as at the effective time of the Share Exchange, and the New Vizsla Silver Shares received on the Share Exchange at a cost equal to the amount, if any, by which the ACB of the Resident Holder's Vizsla Silver Shares immediately before the Share Exchange exceeds the aggregate fair market value of the Spinco Shares and Spinco Warrants as at the effective time of the Share Exchange.

Disposition of New Vizsla Silver Shares or Spinco Shares after the Arrangement

A Resident Holder who disposes or is deemed to dispose of a New Vizsla Silver Share or Spinco Share (other than to the Company or Spinco, as applicable, unless purchased by the Company or Spinco on the open market in the manner in which shares are normally purchased by any member of the public in the open market) generally will realize a capital gain (or capital loss) equal to the amount, if any, by which the proceeds of disposition therefor are greater (or less) than the ACB of such share to the Resident Holder, as applicable, less reasonable costs of disposition. Any such capital gain or capital loss will be subject to the treatment generally described below under "Holders Resident in Canada - Taxation of Capital Gains and Capital Losses".


Exercise and Disposition of Spinco Warrants

Generally, no gain or loss will be realized by a Resident Holder upon the exercise of a Spinco Warrant to acquire a Spinco Share. When a Spinco Warrant is exercised, the Resident Holder's cost of the Spinco Share acquired thereby will be the total of the Resident Holder's ACB of such Spinco Warrant and the exercise price paid for the Spinco Share. The Resident Holder's ACB of the Spinco Shares so acquired will be determined by averaging such cost with the ACB to the Resident Holder of all Spinco Shares owned by the Resident Holder as capital property immediately prior to such acquisition.

A Resident Holder who disposes or is deemed to dispose of a Spinco Warrant (other than on the exercise thereof) generally will realize a capital gain (or capital loss) equal to the amount, if any, by which the proceeds of disposition, net of any reasonable costs of disposition, are greater (or less) than the ACB to the Resident Holder of the Spinco Warrant immediately before the disposition or deemed disposition. The expiry of an unexercised Spinco Warrant generally will result in a capital loss to the Resident Holder equal to the ACB of the Spinco Warrant. The tax treatment of any such capital gain or capital loss is described below under "Holders Resident in Canada - Taxation of Capital Gains and Capital Losses".

Taxation of Dividends - New Vizsla Silver Shares and Spinco Shares

A Resident Holder who is an individual (other than certain trusts) and receives or is deemed to receive a taxable dividend in a taxation year on the Resident Holder's New Vizsla Silver Shares or Spinco Shares will be required to include the amount of the dividend in income for the year, subject to the dividend gross-up and tax credit rules applicable to taxable dividends received by a Canadian resident individual from a taxable Canadian corporation, including the enhanced dividend gross-up and tax credit that may be applicable if and to the extent that the Company or Spinco designates the taxable dividend to be an "eligible dividend" in accordance with the Tax Act. There may be limitations on the ability of either the Company or Spinco to designate dividends as "eligible dividends" and neither the Company nor Spinco has made commitments in this regard.

A Resident Holder that is a corporation and receives or is deemed to receive a taxable dividend in a taxation year on its New Vizsla Silver Shares or Spinco Shares must include the amount in its income for the year, but generally will be entitled to deduct an equivalent amount from its taxable income, subject to all restrictions under the Tax Act.

In certain circumstances, subsection 55(2) of the Tax Act will treat a taxable dividend received by a Resident Holder that is a corporation as proceeds of disposition or capital gain. Resident Holders that are corporations are urged to consult their own tax advisers having regard to their particular circumstances. A Resident Holder that is a "private corporation" or a "subject corporation" (as defined in the Tax Act) may also be liable under Part IV of the Tax Act to pay an additional tax (refundable in certain circumstances) on any such dividends to the extent that the dividend is deductible in computing the corporation's taxable income.

Taxation of Capital Gains and Capital Losses

A Resident Holder who realizes a capital gain or capital loss in a taxation year on the actual or deemed disposition of a share or warrant, including a Vizsla Silver Share, New Vizsla Silver Share, Spinco Share or Spinco Warrant, as applicable, generally will be required to include any such capital gain multipled by the capital gains inclusion rate applicable at that time (a "taxable capital gain") in the Resident Holder's income for the year, and entitled to deduct any such capital loss multipled by the capital gains inclusion rate applicable at that time (an "allowable capital loss") against taxable capital gains realized in the year and, to the extent not so deductible, in any of the three preceding taxation years or any subsequent taxation year, to the extent and in the circumstances specified in the Tax Act.

The current applicable capital gains inclusion rate is one-half. The 2024 Canadian federal budget introduced in Parliament on April 16, 2024 (the "2024 Canadian Federal Budget") proposes amendments to the Tax Act to increase the capital gains inclusion rate from one-half to two-thirds for corporations and trusts, and from one-half to two-thirds on the portion of capital gains realized in the year that that exceed $250,000 for individuals, for capital gains realized on or after June 25, 2024. Corresponding changes are also proposed with respect to the rules calculating allowable capital losses. If adopted, these amendments may affect the computation of the taxable income of a Resident Holder. Resident Holders to whom these rules may be relevant should consult their own tax advisors.


The amount of any capital loss realized by a Resident Holder that is a corporation on the disposition of a Vizsla Silver Share, New Vizsla Silver Share or Spinco Share may be reduced by the amount of dividends received or deemed to have been received by it on such share (or on a share substituted therefor) to the extent and in the circumstances described in the Tax Act. Similar rules may apply where the corporation is a member or beneficiary of a partnership or trust that owns the share, or where a partnership or trust of which the corporation is a member or beneficiary is itself a member of a partnership or a beneficiary of a trust that owns the share. Affected Resident Holders should consult their own tax advisors in this regard.

Additional Refundable Tax on Canadian-Controlled Private Corporations

A Resident Holder that is a "Canadian-controlled private corporation" (as defined in the Tax Act) throughout the relevant taxation year may be liable to pay an additional tax (refundable in certain circumstances) on its "aggregate investment income", which includes net taxable capital gains realized on the disposition (or deemed disposition) of its Vizsla Silver Shares, New Vizsla Silver Shares, Spinco Shares or Spinco Warrants, dividends received (or deemed to be received in respect of such underlying shares) that are not deductible under the Tax Act, and interest. Proposed Amendments pursuant to Bill C-59, An Act to implement certain provisions of the fall economic statement tabled in Parliament on November 21, 2023 and certain provisions of the budget tabled in Parliament on March 28, 2023, are intended to extend this additional tax and refund mechanism in respect of aggregate investment income to "substantive CCPCs" as defined in such Proposed Amendments. Resident Holders should consult their own tax advisors with regard to this additional tax and refund mechanism.

Minimum Tax on Individuals

A Resident Holder who is an individual (including certain trusts) and receives a taxable dividend on, or realizes a capital gain on the disposition of, a share or warrant, including a Vizsla Silver Share, New Vizsla Silver Share, Spinco Share or Spinco Warrant, as applicable, may thereby be liable for minimum tax to the extent and within the circumstances set out in the Tax Act. The 2023 Canadian federal budget introduced in Parliament on March 28, 2023, and the 2024 Canadian Federal Budget include proposals to amend the minimum tax rules in the Tax Act. Such Proposed Amendments, if adopted, may affect the liability of a Resident Holder for minimum tax. Resident Holders to whom these rules may be relevant should consult their own tax advisors.

Dissenting Resident Holders

A Resident Holder who validly exercises Dissent Rights (a "Dissenting Resident Holder") and who consequently transfers or is deemed to transfer Vizsla Silver Shares to Vizsla Silver for payment by the Company will be deemed to receive a taxable dividend in the taxation year of payment equal to the amount, if any, by which the payment (excluding interest) exceeds the PUC of the Dissenting Resident Holder's Vizsla Silver Shares determined immediately before the Arrangement. Any such taxable dividend will be taxable as described above under "Holders Resident in Canada - Taxation of Dividends - New Vizsla Silver Shares and Spinco Shares". The Dissenting Resident Holder will also realize a capital gain (or capital loss) equal to the amount, if any, by which the payment (excluding interest), less any such deemed taxable dividend, exceeds (is exceeded by) the ACB of the Dissenting Resident Holder's Vizsla Silver Shares determined immediately before the Arrangement. Any such capital gain or loss will generally be taxable or deductible as described above under "Holders Resident in Canada - Taxation of Capital Gains and Capital Losses".

The Dissenting Resident Holder will be required to include any portion of the payment that is on account of interest in the Dissenting Resident Holder's income in the year received.

Dissenting Resident Holders should consult their own tax advisors.

Eligibility for Investment - New Vizsla Silver Shares, Spinco Shares and Spinco Warrants

A New Vizsla Silver Share will be a "qualified investment" for a trust governed by an RRSP, an RRIF, an RESP, an RDSP, a TFSA, a FHSA (collectively, "Registered Plans") or a DPSP as those terms are defined in the Tax Act at any time at which the New Vizsla Silver Shares are listed on a "designated stock exchange" as defined in the Tax Act (which includes the TSX-V), or the Company is a "public corporation" as defined in the Tax Act.


A Spinco Share and Spinco Warrant will not be a qualified investment for a Registered Plan or a DPSP from the date of issuance unless (i) on or before its filing due date for its first taxation year, the Spinco Shares are listed on a "designated stock exchange" as defined in the Tax Act (or Spinco otherwise satisfies the conditions to be a "public corporation" for purposes of the Tax Act), and Spinco validly elects to be a "public corporation" for purposes of the Tax Act from the commencement of its first taxation year, and (ii) in case of the Spinco Warrants, neither Spinco, nor any person with whom Spinco does not deal at arm's length, is an annuitant, a beneficiary, an employer or a subscriber under, or a holder of a particular Registered Plan or a DPSP. There can be no assurance as to if, or when, the Spinco Shares will be listed or traded on any stock exchange and, therefore, no assurance as to if, or when, Spinco will be able to make the election to be a public corporation. Should the Spinco Shares and Spinco Warrants be distributed to or otherwise acquired by a Registered Plan or a DPSP other than as "qualified investments", adverse tax consequences not described in this summary should be expected to arise for the Registered Plan or DPSP and the annuitant, holder, or subscriber thereunder. Resident Holders that hold Vizsla Silver Shares and will or may hold Spinco Shares and Spinco Warrants within a Registered Plan or a DPSP should consult with their own tax advisors in this regard.

Notwithstanding that the New Vizsla Silver Shares, Spinco Shares or Spinco Warrants may be qualified investments at a particular time, the holder of a FHSA, TFSA, RDSP, the annuitant of an RRSP or RRIF or subscriber of an RESP, as the case may be (the "Controlling Individual") will be subject to a penalty tax in respect of a New Vizsla Silver Share, Spinco Share or Spinco Warrant held in the Registered Plan if the New Vizsla Silver Share, Spinco Share or Spinco Warrant, as the cas may be, is a "prohibited investment" under the Tax Act. A New Vizsla Silver Share, Spinco Share or Spinco Warrant generally will not be a prohibited investment for a Registered Plan provided that (i) the Controlling Individual does not have a "significant interest" within the meaning of the Tax Act in Vizsla Silver or Spinco, as applicable, and (ii) the Controlling Individual deals at arm's length with Vizsla Silver or Spinco, as applicable, for the purposes of the Tax Act. In addition, a New Vizsla Silver Share, Spinco Share or Spinco Warrant will not be a "prohibited investment" if such shares or warrants are "excluded property" as defined in the Tax Act for a Registered Plan. Shareholders should consult their own tax advisers to ensure that the New Vizsla Silver

Shares, Spinco Shares and Spinco Warrants would not be a prohibited investment for a trust governed by a Registered Plan in their particular circumstances.

HOLDERS NOT RESIDENT IN CANADA

This portion of this summary applies only to Holders each of whom at all material times for the purposes of the Tax Act (i) has not been and is not resident or deemed to be resident in Canada for purposes of the Tax Act, and (ii) does not and will not use or hold Vizsla Silver Shares, New Vizsla Silver Shares, Spinco Shares or Spinco Warrants in connection with carrying on a business in Canada (each, a "Non-Resident Holder").

Special rules, which are not discussed in this summary, may apply to a Non-Resident Holder that is an insurer carrying on a business in Canada and elsewhere, or an "authorized foreign bank" as defined in the Tax Act. Such Non-Resident Holders should consult their own tax advisers with respect to the Arrangement.

Exchange of Vizsla Silver Shares for New Vizsla Silver Shares, Spinco Shares and Spinco Warrants

The discussion of the tax consequences of the Share Exchange for Resident Holders under the heading "Holders Resident in Canada - Exchange of Vizsla Silver Shares for New Vizsla Silver Shares, Spinco Shares and Spinco Warrants" generally will also apply to Non-Resident Holders in respect of the Share Exchange. The general taxation rules applicable to Non-Resident Holders in respect of a deemed taxable dividend or capital gain arising on the Share Exchange are discussed below under the headings "Holders Not Resident in Canada - Taxation of Dividends - New Vizsla Silver Shares and Spinco Shares" and "Holders Not Resident in Canada - Taxation of Capital Gains and Capital Losses" respectively.

Exercise and Disposition of Spinco Warrants

Generally, no gain or loss will be realized by a Non-Resident Holder for purposes of the Tax Act upon the exercise of a Spinco Warrant to acquire a Spinco Share. A Non-Resident Holder generally will not be subject to Canadian federal income tax under the Tax Act on any capital gain realized on a disposition or deemed disposition of Spinco Warrants (other than on the exercise thereof), unless the underlying Spinco Shares are "taxable Canadian property" to the Non- Resident Holder for purposes of the Tax Act and the Non-Resident Holder is not entitled to relief from Canadian federal income tax under an applicable income tax treaty or convention. A description of the definition of "taxable Canadian property" in respect of a Non-Resident Holder is discussed below under the heading "Holders Not Resident in Canada - Taxation of Capital Gains and Capital Losses".


Taxation of Dividends - New Vizsla Silver Shares and Spinco Shares

A Non-Resident Holder to whom the Company or Spinco pays or credits (or is deemed to pay or credit) an amount as a dividend in respect of the Arrangement (if at all), or otherwise in respect of the Non-Resident Holder's New Vizsla Silver Shares or Spinco Shares, will be subject to Canadian withholding tax equal to 25% (or such lower rate as may be available under an applicable income tax treaty or convention, if any) of the gross amount of the dividend. For example, in the case of a Non-Resident Holder who is a resident of the United States for the purposes of the Canada- US Tax Act Convention (1980), as amended (the "Treaty"), who is the beneficial owner of the dividend, and who qualifies for full benefits of the Treaty (a "US Treaty Holder"), the applicable rate of such withholding tax will be reduced to 15% (or 5% of the amount of such dividends received by a US Treaty Holder that is a company that holds at least 10% of the voting stock of the Company or Spinco, as applicable).

Taxation of Capital Gains and Capital Losses

A Non-Resident Holder will not be subject to Canadian federal income tax in respect of any capital gain arising on an actual or deemed disposition of a Vizsla Silver Share, New Vizsla Silver Share, Spinco Share or Spinco Warrant unless, at the time of disposition, the share or warrant, as applicable, is "taxable Canadian property" as defined in the Tax Act, and is not "treaty-protected property" as defined in the Tax Act.

Generally, a Vizsla Silver Share, New Vizsla Silver Share, Spinco Share or Spinco Warrant, as applicable, of the Non- Resident Holder will not be taxable Canadian property of the Non-Resident Holder at any time at which the underlying share is listed on a "designated stock exchange" as defined in the Tax Act (which includes the TSX-V) unless, at any time during the 60 months immediately preceding the disposition of the share or warrant:

(a) the Non-Resident Holder, one or more persons with whom the Non-Resident Holder did not deal at arm's length, partnerships in which the Non-Resident Holder or persons with whom the Non-Resident Holder did not deal at arm's length held membership interests (directly or indirectly), or any combination of the foregoing, owned 25% or more of the issued shares of any class of the capital stock of the Company or Spinco, as applicable; and

(b) the underlying share derived more than 50% of its fair market value directly or indirectly from, or from any combination of, real or immovable property situated in Canada, "Canadian resource properties", "timber resource properties" (as those terms are defined in the Tax Act), and interest, rights or options in or in respect of any of the foregoing.

Further, a Spinco Share or Spinco Warrant of a Non-Resident Holder will not be taxable Canadian property of the Non-Resident Holder at any time at which the underlying share is not listed on a "designated stock exchange" unless, at any time during the 60 months immediately preceding the disposition of the share or warrant, the underlying share derived more than 50% of its fair market value directly or indirectly from, or from any combination of, real or immovable property situated in Canada, "Canadian resource properties", "timber resource properties" (as those terms are defined in the Tax Act), and interest, rights or options in or in respect of any of the foregoing.

Shares may also be deemed to be "taxable Canadian property" under other provisions of the Tax Act.

A Non-Resident Holder who disposes or is deemed to dispose of a Vizsla Silver Share, New Vizsla Silver Share, Spinco Share or Spinco Warrant that, at the time of disposition, is taxable Canadian property and is not treaty protected property will realize a capital gain (or capital loss) equal to the amount, if any, by which the Non-Resident Holder's proceeds of disposition of the share or warrant exceeds (or is exceeded by) the Non-Resident Holder's ACB in the share or warrant and reasonable costs of disposition. The Non-Resident Holders will generally be subject to the same Canadian income tax consequences for a Resident Holder discussed above under the heading "Holders Resident in Canada - Taxation of Capital Gains and Capital Losses".


Non-Resident Holders who may hold shares or warrants as "taxable Canadian property" should consult their own tax advisors in this regard, including with respect to the potential Canadian income tax filing requirements of owning and disposing of such shares or warrants.

Dissenting Non-Resident Holders

The discussion above applicable to Resident Holders under the heading "Holders Resident in Canada - Dissenting Resident Holders" will generally also apply to a Non-Resident Holder who validly exercises Dissent Rights in respect of the Arrangement. In general terms, the Non-Resident Holder will be subject to Canadian federal income tax in respect of any deemed taxable dividend arising as a consequence of the exercise of Dissent Rights generally as discussed above under the heading "Holders Not Resident in Canada - Taxation of Dividends - New Vizsla Silver Shares and Spinco Shares" and subject to the Canadian federal income tax treatment in respect of any capital gain or loss arising as a consequence of the exercise of Dissent Rights generally as discussed above under the heading "Holders Not Resident in Canada - Taxation of Capital Gains and Capital Losses".

MATERIAL UNITED STATES FEDERAL INCOME TAX CONSIDERATIONS

The following summarizes certain U.S. federal income tax considerations under the U.S. Tax Code generally applicable to U.S. Holders (as defined below) in respect of the receipt, holding, and disposition of Spinco Shares and Spinco Warrants acquired pursuant to the Arrangement.

This discussion is based upon the provisions of the U.S. Tax Code, existing final and temporary regulations promulgated thereunder (the "Treasury Regulations"), and current administrative rulings and court decisions, all of which are subject to change, possibly with retroactive effect. Changes in these authorities may cause the U.S. federal income tax consequences to vary substantially from those described below.

Vizsla Silver and Spinco have not requested and will not request a ruling from the Internal Revenue Service ("IRS") with respect to any of the U.S. federal income tax consequences described below. The IRS may disagree with and challenge any of the conclusions reached herein.

This discussion applies only to U.S. Holders (as defined below) that own Vizsla Silver Shares and will own Spinco Shares and Spinco Warrants as "capital assets" within the meaning of Section 1221 of the U.S. Tax Code (generally, property held for investment), and does not comment on all aspects of U.S. federal income taxation that may be important to certain U.S. Holders in light of their particular circumstances, such as U.S. Holders subject to special tax rules (e.g., banks and other financial institutions, brokers, dealers or traders in securities or commodities, insurance companies, regulated investment companies, real estate investment trusts, traders that elect to mark-to-market their securities, certain expatriates or former long-term residents of the United States, personal holding companies, "S" corporations, U.S. expatriates, tax-exempt organizations, tax-qualified retirement plans, persons that own directly, indirectly, or constructively 10% or more of Vizsla Silver's voting stock or will own 10% or more of Spinco's voting stock, persons who are subject to alternative minimum tax, persons who hold Shares as a position in a "straddle" or as part of a "hedging," "conversion" or "integrated" transaction, persons that have a functional currency other than the U.S. dollar, controlled foreign corporations, passive foreign investment companies, or persons who acquired Vizsla Silver Shares through the exercise of employee stock options or otherwise as compensation for services). If a partnership (including any entity treated as a partnership for U.S. federal income tax purposes) is a Shareholder, the tax treatment of a partner in the partnership generally will depend upon the status of the partner and the activities of the partnership. Partnerships or partners in a partnership holding Vizsla Silver Shares are urged to consult their own tax advisors regarding the tax consequences of the Arrangement.

In addition, this summary does not address U.S. federal estate and gift tax, alternative minimum tax, the Foreign Account Tax Compliance Act or Medicare tax on net investment income considerations, or any U.S. state or local or non-U.S. tax considerations. All Vizsla Shareholders, including those subject to special provisions of the Code such as those described above, should consult their own tax advisors regarding the U.S. federal, U.S. state and local, and non-U.S. tax consequences relating to the Plan of Arrangement, the ownership and disposition of Vizsla Shares and the ownership and disposition of Spinco Shares and Spinco Warrants received pursuant to the Plan of Arrangement.


THIS SUMMARY IS FOR GENERAL INFORMATION ONLY AND IS NOT INTENDED TO CONSTITUTE A COMPLETE DESCRIPTION OF ALL TAX CONSEQUENCES RELATING TO THE ARRANGEMENT. SHAREHOLDERS ARE URGED TO CONSULT THEIR OWN TAX ADVISORS REGARDING THE TAX CONSEQUENCES TO THEM (INCLUDING THE APPLICATION AND EFFECT OF ANY STATE, LOCAL AND NON-U.S. INCOME AND OTHER TAX LAWS) OF THE ARRANGEMENT.

For purposes of this summary, a "U.S. Holder" is a beneficial owner of Vizsla Silver Shares that is: (i) a U.S. citizen or U.S. resident alien as determined for U.S. federal income tax purposes, (ii) a corporation, or other entity taxable as a corporation for U.S. federal income tax purposes, that was created or organized under the laws of the United States, any State thereof or the District of Columbia, (iii) an estate whose income is subject to U.S. federal income taxation regardless of its source, or (iv) a trust that either is subject to the supervision of a court within the United States and has one or more U.S. persons with authority to control all of its substantial decisions or has a valid election in effect under applicable Treasury Regulations to be treated as a U.S. person.

TREATMENT OF THE ARRANGEMENT

The distribution of Spinco Shares and Spinco Warrants (including any amount withheld for Canadian taxes) to a U.S. Holder pursuant to the Arrangement will be treated as a distribution to the U.S. Holder with respect to the U.S. Holder's Vizsla Silver Shares in an amount equal to the fair market value of the Spinco Shares and Spinco Warrants received. A distribution to a U.S. Holder will be taxable to the U.S. Holder as a foreign source dividend to the extent Vizsla Silver the distribution is out of Vizsla Silver's current or accumulated earnings and profits. Although it does not track current or accumulated earnings and profits for any reason, Vizsla Silver believes it likely has some amount of current or accumulated earnings and profits such that all or a portion of the value of Spinco Shares and Spinco Warrants received by a U.S. Holder will be taxable as a dividend. The distribution of a New Vizsla Silver Share in respect of each existing Vizsla Silver Share will not be a taxable exchange and U.S. Holders will, subject to the discussion below concerning a non-taxable return of capital in connection with the distribution of Spinco Shares and Spinco Warrants, have the same adjusted tax basis in New Vizsla Silver Shares as, and will include the holding period of, the existing Vizsla Silver Shares held by such U.S. Holder. Therefore, the remainder of this discussion refers simply to Vizsla Silver Shares.

A dividend received by a non-corporate U.S. Holder will be taxable at a preferential rate, provided that (a) the Vizsla Silver Shares are readily tradable on an established securities market in the United States or Vizsla Silver is otherwise treated as a "qualified foreign corporation" within the meaning of the Code's provisions governing qualified dividend income, (b) Vizsla Silver is not a passive foreign investment company ("PFIC") in the taxable year in which such dividends are paid or any preceding taxable year such U.S. Holder held Vizsla Silver Shares, (c) such U.S. Holder satisfies a holding period requirement, and (d) certain other requirements are met. Vizsla Silver believes it is a qualified foreign corporation. Vizsla Silver has not made any determination for any prior year whether it was then, and has not determined nor can it give any assurances with regard to the current year or any future year, whether it is or will become, a PFIC (See "Passive Foreign Investment Company Rules" below). If Vizsla Silver is a PFIC, the distribution of the Spinco Shares and Spinco Warrants may constitute an "excess distribution" subject to the special tax treatment described for excess distributions under "Consequences of PFIC Status" below.

Subject to the PFIC rules discussed below, a dividend received by a corporate U.S. Holder will generally be taxable at regular rates and will not be eligible for the dividends-received deduction generally allowed to U.S. corporations in respect of dividends received from other U.S. corporations.

Distributions in excess of Vizsla Silver's current and accumulated earnings and profits will be treated first as a non- taxable return of capital to the extent of the U.S. Holder's tax basis in its Vizsla Silver Shares and thereafter as an amount realized in a sale or exchange of the U.S. Holder's Vizsla Silver Shares. Such amounts will be taxable in accordance with the section below titled "Treatment of a Sale of Shares".

A U.S. Holder's initial tax basis in its Spinco Shares generally will equal the fair market value of the Spinco Shares on the Effective Date. A U.S. Holder's holding period in its Spinco Shares generally will begin on the Effective Date.


TREATMENT OF A SALE OF SHARES

Subject to the PFIC rules discussed below, a U.S. Holder that sells or is treated as selling all or a portion of its Vizsla Silver Shares or Spinco Shares will recognize U.S. source capital gain or loss in an amount equal to the difference between (x) the sum of the amount of cash and fair market value of property received in the sale and the amount of any Canadian withholding tax withheld in respect of such U.S. Holder and (y) the U.S. Holder's adjusted tax basis in such Vizsla Silver Shares or Spinco Shares. The gain or loss recognized generally will be treated as long-term capital gain or loss if the U.S. Holder's holding period in the Vizsla Silver Shares or Spinco Shares is greater than one year as of the date of the sale.

Certain U.S. Holders, including individuals, may be eligible for preferential tax rates on long-term capital gains. A U.S. Holder's ability to deduct capital losses is limited.

ADDITIONAL TAX ON INVESTMENT INCOME

U.S. Holders who are individuals, estates, or trusts and whose income exceeds certain thresholds will be required to pay (in addition to U.S. federal income tax) a 3.8% tax on net investment income, including dividends and gains from the sale or other taxable disposition of Vizsla Silver Shares or Spinco Shares. U.S. Holders are urged to consult their tax advisors regarding whether this tax will apply to them.

PASSIVE FOREIGN INVESTMENT COMPANY RULES

In General

A foreign corporation is a PFIC for U.S. federal income tax purposes if either (A) at least 75% of its gross income in a taxable year, including its pro rata share of the gross income of any corporation in which it is considered to own at least 25% of the shares by value, is passive income, or (B) at least 50% of its assets in a taxable year, ordinarily determined based on fair market value and averaged quarterly over the year, including its pro rata share of the assets of any corporation in which it is considered to own at least 25% of the shares by value, are held for the production of or produce passive income. Passive income generally includes dividends, interest, rents and royalties, and gains from the disposition of passive assets. Vizsla Silver has not made any determination for any prior year whether it was then a PFIC. The determination of whether any corporation was, is or will be, a PFIC for a tax year depends, in part, on the application of complex U.S. federal income tax rules, which are subject to differing interpretations. In addition, whether any corporation will be a PFIC for any tax year depends on the assets and income of such corporation over the entire course of each such tax year and, as a result, cannot be predicted by Vizsla Silver with certainty for the current tax year or for any future tax year as of the date of this document. Accordingly, there can be no assurance that Vizsla Silver is not or will not become a PFIC for the current year or any future tax year. Nor can there be any assurance that the IRS will not challenge any determination Vizsla Silver might make in the future concerning its PFIC status.

If Vizsla Silver is a PFIC for any year during which a U.S. Holder holds Vizsla Silver Shares, such holder will be subject to the rules described below under "Consequences of PFIC Status".

Each U.S. Holder should consult its own tax advisors regarding PFIC status.

In any year in which Vizsla Silver is a PFIC, a U.S. Holder may be required to file an annual report with the IRS containing such information as Treasury Regulations and/or other IRS guidance may require, including IRS Form 8621. In addition to penalties, a failure to satisfy such reporting requirements may result in an extension of the time period during which the IRS can assess a tax. (See "PFIC Reporting Requirements" below.)

U.S. Holders should consult their own tax advisors regarding the requirements of filing such information returns under these rules, including the requirement to file an IRS Form 8621 annually.

Due to the limited assets and income streams of Spinco, the application of the PFIC rules discussed above are more clear and U.S. Holders should be aware that Spinco expects to be a PFIC for the current taxable year and potentially for future years.


Consequences of PFIC Status

Although Spinco expects to be a PFIC, and Vizsla Silver has not made a PFIC determination, either corporation's actual PFIC status for any taxable year will not be determinable until after the end of such taxable year. If either Vizsla Silver is, or as Spinco expects, Spinco is, classified as a PFIC for any taxable year or portion of a taxable year that is included in a U.S. Holder's holding period of such corporation's shares, and the U.S. Holder does not timely make either a QEF election or does not or is not eligible to make a mark-to-market election, each as defined below, the U.S. Holder generally will be subject to the following "PFIC Distribution Rules" with respect to the applicable corporation's shares:

 each distribution to the U.S. Holder will be deemed to be an "excess distribution" to the extent of its pro rata share of any excess of the aggregate of all distributions made to the U.S. Holder in the U.S. Holder's current taxable year over 125% of the three-year moving average of such aggregates;

 any gain recognized by a U.S. Holder on a sale or other disposition of Spinco Shares will also be deemed to be an excess distribution;

 each excess distribution will be allocated pro rata to each day in the U.S. Holder's holding period, up to the date of the distribution;

 the amounts allocated to the U.S. Holder's current taxable year, and the amounts allocated to the period in the U.S. Holder's holding period which pre-dates such corporation's status as a PFIC, if there is such a period, will be taxed as ordinary income (not long-term capital gain);

 the amounts allocated to any other taxable year or part of a year will be taxed at the highest tax rate in effect for that year and applicable to the U.S. Holder; and

 the tax liabilities that arise from the amounts allocated to each such other taxable year will accrue retroactive interest as unpaid taxes.

A U.S. Holder that holds shares in a year in which the relevant corporation is a PFIC will continue to be treated as owning shares of a PFIC in later years even if such corporation is no longer a PFIC in those later years.

QEF Election

If Spinco or Vizsla Silver is a PFIC, a U.S. Holder may avoid the PFIC Distribution Rules with respect to such corporation's shares by making a timely QEF election during the first taxable year in which such corporation is a PFIC and in which the U.S. Holder holds or is deemed to hold such shares. If a U.S. Holder makes a QEF election, it will become subject to the following "QEF Allocation Rules":

 the U.S. Holder will include in its income in each of its taxable years in which or with which a taxable year of the corporation ends, its pro rata share of such corporation's net capital gain (as long-term capital gain) and any other earnings and profits (as ordinary income), regardless of whether such corporation distributes such gain or earnings and profits to the U.S. Holder;

 the U.S. Holder's tax basis in its shares will be increased by the amount of such income inclusions;

 distributions of previously included earnings and profits will not be taxable in the U.S. to the U.S. Holder;

 the U.S. Holder's tax basis in its shares will be decreased by the amount of such distributions; and

 any gain recognized by the U.S. Holder on a sale, redemption or other taxable disposition of its shares will be taxable as capital gain and no interest charge will be imposed.

A U.S. Holder that makes a QEF election may make an additional election to defer payment of its liability for tax on included but undistributed income, but such deferred payments are subject to an interest charge.


A QEF election is made on a shareholder-by-shareholder basis and may be revoked only with the consent of the IRS. A U.S. Holder generally makes a QEF election by attaching a completed IRS Form 8621 (Return by a Shareholder of a Passive Foreign Investment Company or Qualified Electing Fund), including the information provided in a PFIC annual information statement, to a timely filed U.S. federal income tax return for the tax year of the U.S. Holder to which the election relates. Retroactive QEF elections generally may be made only by filing a protective statement with such return and if certain other conditions are met or with the consent of the IRS. U.S. Holders are urged to consult their tax advisors regarding the availability and tax consequences of a retroactive QEF election under their particular circumstances.

To comply with the requirements of a QEF election, a U.S. Holder must receive a PFIC annual information statement from the corporation. If Spinco determines it is a PFIC for any taxable year it will endeavor to provide each U.S. Holder such information as the IRS may require, including a PFIC annual information statement, to enable the U.S. Holder to make and maintain a QEF election. However, there is no assurance that Spinco will have timely knowledge of its status as a PFIC in the future or of the information required to be provided.

A U.S. Holder that makes a QEF election in the first taxable year in which the corporation is a PFIC and in which the U.S. Holder holds or is deemed to hold its shares will avoid the PFIC Distribution Rules and will not be subject to the QEF Allocation Rules in any taxable year of the corporation that ends within or with a taxable year of the U.S. Holder and in which such corporation is not a PFIC. However, if the U.S. Holder's QEF election is not effective for each of the corporation's taxable years in which it is a PFIC and in which the U.S. Holder holds or is deemed to hold such corporation's shares, the PFIC Distribution Rules will apply to the U.S. Holder until the U.S. Holder makes a purging election. If a U.S. Holder makes a purging election the following occurs: (a) the U.S. Holder is deemed to sell its shares at their fair market value; (b) the gain recognized by the U.S. Holder in the deemed sale is taxed under the PFIC Distribution Rules; (c) the U.S. Holder obtains a new basis and holding period in its shares for PFIC purposes; and (d) the U.S. Holder becomes eligible to make a QEF election.

Mark-to-Market Election

If a PFIC's shares are regularly traded on a registered national securities exchange or certain other exchanges or markets, they would constitute "marketable stock" for purposes of the PFIC rules, and a U.S. Holder would not be subject to the foregoing PFIC rules if such U.S. Holder made a mark-to-market election with respect to such PFIC's shares. It is expected that the Spinco Shares will not be regularly traded, so the mark-to-market election is not expected to be available with respect to the Spinco Shares.

Subsidiary PFICs

A PFIC may own interests in other entities that are classified as PFICs. In such event, a U.S. Holder will be deemed to own a portion of the parent corporation's shares in such subsidiary PFIC and could incur liability under the PFIC Distribution Rules if the parent corporation receives a distribution from (including a sale of its shares in) a subsidiary PFIC, or if the U.S. Holder is otherwise deemed to have disposed of an interest in a subsidiary PFIC. Spinco will endeavor to cause all subsidiary PFICs to provide U.S. Holders the information required to make or maintain QEF elections with respect to the subsidiary PFICs. If a U.S. Holder makes a QEF election with respect to a subsidiary PFIC, tracking the tax bases of the U.S. Holder's interests in the tiered PFIC structure will become extremely complicated. There is no assurance that Spinco will have timely knowledge of the PFIC status of any subsidiary. In addition, Spinco may not hold a controlling interest in any such subsidiary PFIC and thus there can be no assurance it will be able to cause the subsidiary PFIC to provide the required information. U.S. Holders are urged to consult their tax advisors regarding the tax issues surrounding subsidiary PFICs.

PFIC Reporting Requirements

A U.S. Holder that owns or is deemed to own PFIC shares in any taxable year of the U.S. Holder may have to file an IRS Form 8621, Information Return by a Shareholder of a Passive Foreign Investment Company or Qualified Electing Fund, (whether or not a QEF or market-to-market election is made) and provide such other information as may be required by the U.S. Treasury Department. Failure to file a required form or provide required information will extend the statute of limitations on assessment of a deficiency until the required form or information is furnished to the IRS.


The rules for PFICs, QEF elections and mark-to-market elections are complex and affected by various factors in addition to those described above. U.S. Holders are urged to consult their tax advisors regarding the application of the rules to their particular circumstances.

Foreign Tax Credits and Limitations

A U.S. Holder that pays, through withholding, Canadian tax, with respect to any dividends paid on Vizsla Silver Shares or Spinco Shares or in connection with the sale, redemption or other taxable disposition of Vizsla Silver Shares or Spinco Shares may elect for any taxable year to receive either a credit or a deduction for all foreign income taxes paid by such U.S. Holder during the year. Complex limitations apply to foreign tax credits. Each U.S. Holder should consult its own tax advisor regarding applicable foreign tax credit rules.

Foreign Currency

The amount of any distribution paid to a U.S. Holder in foreign currency, or the amount of proceeds paid in foreign currency on the sale, exchange or other taxable disposition of Vizsla Silver Shares or Spinco Shares, generally will be equal to the U.S. dollar value of such foreign currency based on the exchange rate applicable on the date of receipt (regardless of whether such foreign currency is converted into U.S. dollars at that time). A U.S. Holder will have a basis in the foreign currency equal to its U.S. dollar value on the date of receipt. Any U.S. Holder who converts or otherwise disposes of the foreign currency after the date of receipt may have a foreign currency exchange gain or loss that would be treated as ordinary income or loss, and generally will be U.S. source income or loss for foreign tax credit purposes. Different rules apply to U.S. Holders who use the accrual method of tax accounting. Each U.S. Holder should consult its own tax advisors concerning issues related to foreign currency.

Backup Withholding and Information Reporting

The proceeds of a sale or deemed sale by a U.S. Holder of Vizsla Silver Shares or Spinco Shares may be subject to information reporting to the IRS and to U.S. backup withholding. Backup withholding will not apply, however, to a U.S. Holder that furnishes a correct taxpayer identification number and makes other required certifications, or that is otherwise exempt from backup withholding and establishes such exempt status.

Backup withholding is not an additional tax. Amounts withheld may be credited against a U.S. Holder's U.S. federal income tax liability, and a U.S. Holder generally may obtain a refund of any excess amounts withheld under the backup withholding rules by timely filing an appropriate claim for refund with the IRS and furnishing any required information.

Specified Foreign Financial Assets Reporting

Certain U.S. Holders that hold "specified foreign financial assets" are generally required to attach to their annual returns a completed IRS Form 8938, Statement of Specified Foreign Financial Assets, with respect to such assets (and can be subject to substantial penalties for failure to file). The definition of specified foreign financial asset includes not only financial accounts maintained in foreign financial institutions, but also, if held for investment and not held in an account maintained by a financial institution, securities of non-U.S. issuers (subject to certain exceptions, including an exception for securities of non-U.S. issuers held in accounts maintained by domestic financial institutions). U.S. Holders are urged to consult their tax advisors regarding the possible reporting requirements with respect to their investments in Vizsla Silver Shares or Spinco Shares and the penalties for non-compliance.

THIS DISCUSSION IS GENERAL IN NATURE AND DOES NOT DISCUSS ALL ASPECTS OF U.S. FEDERAL INCOME TAXATION THAT MAY BE RELEVANT TO A PARTICULAR SHAREHOLDER IN LIGHT OF THE SHAREHOLDER'S PARTICULAR CIRCUMSTANCES, OR TO CERTAIN TYPES OF SHAREHOLDERS SUBJECT TO SPECIAL TREATMENT UNDER U.S. FEDERAL INCOME TAX LAWS.

YOU ARE URGED TO CONSULT WITH YOUR OWN TAX ADVISOR TO DETERMINE THE PARTICULAR TAX CONSEQUENCES TO YOU OF THE ARRANGEMENT, INCLUDING THE APPLICABILITY AND EFFECT OF STATE, LOCAL AND FOREIGN TAX LAWS.


INFORMATION CONCERNING SPINCO POST-ARRANGEMENT

For further information concerning Spinco following completion of the Arrangement, see Schedule "G" to this Circular.

INFORMATION CONCERNING VIZSLA SILVER POST-ARRANGEMENT

For further information concerning Vizsla Silver following completion of the Arrangement, see Schedule "L" to this Circular. Additional information relating to Vizsla Silver is available on SEDAR+.

ADDITIONAL INFORMATION

Additional information relating to the Company is available on SEDAR+ or on the Company's website at www.vizslasilvercorp.com. Shareholders may contact the Company by telephone at (604) 364-2215 or by e-mail at info@vizslasilver.ca to request copies of the Company's financial statements and related management's discussion and analysis.

Financial information is provided in the Company's comparative consolidated financial statements and management's discussion and analysis for its most recently completed financial year ended April 30, 2023. The Company's comparative unaudited interim consolidated financial statements and related management's discussion and analysis the period ended January 31, 2024 are also filed on SEDAR+ and attached as Schedule "M" to this Circular.

Please refer to Schedule "N" to this Circular for Vizsla Silver's management discussion and analysis ("MD&A") for the nine months ended January 31, 2024 and 2023 and for Vizsla Silver's MD&A for the years ended April 30, 2023 and 2022, respectively. The attached Vizsla Silver MD&A should be read in conjunction with Vizsla Silver's condensed consolidated interim financial statements for the nine months ended January 31, 2024 and 2023 and the annual audited consolidated financial statements for the years ended April 30, 2023 and 2022, together with the notes thereto, which are also attached as Schedule "N" to this Circular, respectively.

OTHER BUSINESS

Management is not aware of any matters to come before the Meeting other than those set forth in the Notice of Meeting. If any other matter properly comes before the Meeting, it is the intention of the persons named in the proxy to vote the Common Shares represented thereby in accordance with their best judgment on such matter.

APPROVAL OF BOARD

The contents and the sending of this Circular have been approved by the Board.

DATED at Vancouver, British Columbia, on May 17, 2024.

BY ORDER OF THE BOARD OF DIRECTORS

"Michael A. Konnert"

Michael A. Konnert

President, Chief Executive Officer and Director


SCHEDULE "A"

ARRANGEMENT RESOLUTION

RESOLUTION OF THE HOLDERS OF COMMON SHARES OF VIZSLA SILVER CORP.

BE IT RESOLVED as a special resolution that:

1. The arrangement agreement dated March 27, 2024 (the "Arrangement Agreement") between Vizsla Silver Corp. ("Vizsla Silver") and Vizsla Royalties Corp. ("Spinco"), as it may be amended, modified or supplemented from time to time in accordance with its terms, attached as Schedule "C" to the notice of special meeting and management information circular (the "Circular") of Vizsla Silver dated effective May 17, 2024 and all transactions contemplated thereby are hereby confirmed, ratified and approved.

2. The arrangement (the "Arrangement") under Part 9, Division 5 of the Business Corporations Act (British Columbia) substantially as set forth in the plan of arrangement (the "Plan of Arrangement"), as it may be amended, modified or supplemented from time to time in accordance with the Arrangement Agreement and its terms, attached as Exhibit "I" to the Arrangement Agreement attached as Schedule "C" to the Circular is hereby approved and authorized.

3. The Arrangement Agreement and all of the transactions contemplated therein, the actions of the directors of Vizsla Silver in approving the Arrangement and the Arrangement Agreement and the actions of the directors and officers of Vizsla Silver in executing and delivering the Arrangement Agreement and any amendments, modifications or supplements thereto are hereby confirmed, ratified and approved.

4. Vizsla Silver is hereby authorized to apply for a final order from the Supreme Court of British Columbia (the "Court") to approve the Arrangement on the terms set forth in the Arrangement Agreement and the Plan of Arrangement (as they may be amended, modified or supplemented from time to time).

5. Notwithstanding that this special resolution has been passed by the Shareholders of Vizsla Silver or has received the approval of the Court, the board of directors of Vizsla Silver may amend the Arrangement Agreement and the Plan of Arrangement to the extent permitted by the Arrangement Agreement and/or decide not to proceed with the Arrangement or revoke this special resolution at any time prior to the filing of the certified copy of the court order approving the Arrangement with the Registrar of Companies for British Columbia without further approval of the Shareholders of Vizsla Silver.

6. Notwithstanding that this special resolution has been passed by the Shareholders of Vizsla Silver or has received the approval of the Court, (a) the alterations made to Vizsla Silver's authorized share structure and Articles contemplated by the Plan of Arrangement shall not take effect until the Notice of Articles of Vizsla Silver is altered to reflect such alterations to the authorized share structure and Articles of Vizsla Silver; and

(b) the directors of Vizsla Silver are hereby authorized and empowered, without further notice to or approval of the Shareholders of Vizsla Silver: (i) to file a Notice of Alteration with the Registrar of Companies to reflect the alterations to the authorized share structure and Articles of Vizsla Silver authorized herein; (ii) to amend, modify or supplement the Arrangement Agreement or the Plan of Arrangement to the extent permitted by their terms; and (iii) subject to the terms of the Arrangement Agreement, not to proceed with the Arrangement and any related transactions.

7. Any one director or officer of Vizsla Silver is hereby authorized, for and on behalf of Vizsla Silver, to execute and deliver, whether under the corporate seal of Vizsla Silver or otherwise, all documents, filings and instruments and take all such other actions as may be necessary or desirable to implement this special resolution and the matters authorized hereby, such determination to be conclusively evidenced by the execution and delivery of any such documents, filings or instruments and the taking of any such actions.


SCHEDULE "B"

OPTION PLAN RESOLUTION

RESOLUTION OF THE HOLDERS OF COMMON SHARES OF VIZSLA SILVER CORP.

BE IT RESOLVED that:

1. Subject to the completion of the arrangement involving Vizsla Silver Corp. ("Vizsla Silver") and Vizsla Royalties Corp. ("Spinco"), as more particularly described in the notice of special meeting and management information circular (the "Circular") of Vizsla Silver dated effective May 17, 2024, the stock option plan substantially in the form attached as Schedule "K" to the Circular is hereby authorized, approved and ratified on behalf of Spinco and Spinco's shareholders as the stock option plan for Spinco; and

2. Any one director or officer of Spinco is hereby authorized, for and on behalf of Spinco, to execute and deliver, whether under the corporate seal of Spinco or otherwise, all documents, filings and instruments and take all such other actions as may be necessary or desirable to implement this ordinary resolution and the matters authorized hereby, such determination to be conclusively evidenced by the execution and delivery of any such documents, filings or instruments and the taking of any such actions.


SCHEDULE "C"

ARRANGEMENT AGREEMENT

(Please see attached)

 


ARRANGEMENT AGREEMENT

THIS ARRANGEMENT AGREEMENT is dated as of March 27, 2024.

BETWEEN:

VIZSLA SILVER CORP., a corporation existing under the Business Corporations Act (British Columbia)

("Vizsla Silver")

AND:

VIZSLA ROYALTIES CORP., a corporation existing under the Business Corporations Act (British Columbia)

("Spinco")

WHEREAS:

(A) Vizsla Silver is the registered and beneficial owner of all of the issued and outstanding Spinco Securities;

(B) Vizsla Silver and Spinco wish to proceed with a corporate restructuring by way of a statutory arrangement under the BCBCA, pursuant to which Vizsla Silver and Spinco will participate in a series of transactions whereby, among other things, Vizsla Silver will distribute to the holders of Vizsla Silver Shares certain of the Spinco Securities such that holders of Vizsla Silver Shares (other than Dissenting Shareholders) will also become holders of Spinco Securities; and

(C) The parties have entered into this Agreement to provide for the matters referred to in the foregoing recitals and for other matters relating to such arrangement.

NOW THEREFORE in consideration of the premises and the respective covenants and agreements herein contained, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged by each of the parties hereto, the parties hereto hereby covenant and agree as follows:

ARTICLE 1

DEFINITIONS, INTERPRETATION AND EXHIBIT

1.1 Definitions. In this Agreement, unless there is something in the subject matter or context inconsistent therewith, the following capitalized words and terms shall have the following meanings:


- 2 -

(a) "Agreement" means this arrangement agreement, including the exhibits attached hereto as the same may be supplemented or amended from time to time;

(b) "Arrangement" means the arrangement pursuant to the Arrangement Provisions as contemplated by the provisions of this Agreement and the Plan of Arrangement;

(c) "Arrangement Provisions" means Part 9, Division 5 of the BCBCA;

(d) "Arrangement Resolutions" means the special resolutions of the Vizsla Silver Shareholders to approve the Arrangement, as required by the Interim Order and the BCBCA;

(e) "BCBCA" means the Business Corporations Act, S.B.C. 2002, c. 57, as amended;

(f) "Board of Directors" means the current and existing board of directors of Vizsla Silver;

(g) "Business Day" means a day which is not a Saturday, Sunday or statutory holiday in Vancouver, British Columbia;

(h) "Constating Documents" means, in respect of Vizsla Silver and Spinco, the Articles and related Notice of Articles under the BCBCA;

(i) "Court" means the Supreme Court of British Columbia;

(j) "Dissent Procedures" means the rules pertaining to the exercise of Dissent Rights as set forth in Division 2 of Part 8 of the BCBCA and Article 5 of the Plan of Arrangement;

(k) "Dissent Rights" means the right of a registered Vizsla Silver Shareholder to dissent from the Arrangement Resolutions in accordance with the provisions of the BCBCA, as modified by the Interim Order, and to be paid the fair value of the Vizsla Silver Shares in respect of which the holder dissents;

(l) "Dissenting Shareholder" means a registered holder of Vizsla Silver Shares who dissents in respect of the Arrangement in strict compliance with the Dissent Procedures and who has not withdrawn or been deemed to have withdrawn such exercise of Dissent Rights;

(m) "Effective Date" shall be the date of the closing of the Arrangement;

(n) "Effective Time" means 12:01 a.m. (Vancouver time) on the Effective Date or such other time on the Effective Date as agreed to in writing by Vizsla Silver and Spinco;

(o) "Final Order" means the final order of the Court, after being informed of the intention to rely upon the Section 3(a)(10) Exemption and similar exemptions from applicable United States securities laws with respect to the issuance of the New Vizsla Silver Shares and the Spinco Securities to be issued pursuant to the Arrangement to Vizsla Silver Shareholders in the United States, approving the Arrangement;


- 3 -

(p) "In the Money Amount" at a particular time with respect to a Vizsla Silver Option, Vizsla Silver Replacement Option or Spinco Option means the amount, if any, by which the fair market value of the underlying security exceeds the exercise price of the relevant option at such time;

(q) "Information Circular" means the management information circular of Vizsla Silver, including all schedules thereto, to be sent to the Vizsla Silver Shareholders in connection with the Vizsla Silver Meeting, together with any amendments or supplements thereto;

(r) "Interim Order" means the interim order of the Court, after being informed of the intention to rely upon the Section 3(a)(10) Exemption and similar exemptions from applicable United States securities laws with respect to the issuance of the New Vizsla Silver Shares and the Spinco Securities to be issued pursuant to the Arrangement to Vizsla Silver Shareholders in the United States, providing advice and directions in connection with the Vizsla Silver Meeting and the Arrangement;

(s) "Listing Date" means the date on which the Spinco Shares and Spinco Warrants are listed for trading on the TSXV;

(t) "New Vizsla Silver Shares" means the new class of common shares without par value which Vizsla Silver will create and issue as described in Section 3.1(b)(ii) of the Plan of Arrangement and for which the Vizsla Silver Class A Shares are, in part, to be exchanged under the Plan of Arrangement and which, immediately after completion of the transactions comprising the Plan of Arrangement, will be identical in every relevant respect to the Vizsla Silver Shares;

(u) "party" means either Vizsla Silver or Spinco and "parties" means, collectively, Vizsla Silver and Spinco;

(v) "Person" means and includes an individual, sole proprietorship, partnership, unincorporated association, unincorporated syndicate, unincorporated organization, trust, body corporate, a trustee, executor, administrator or other legal representative and the Crown or any agency or instrumentality thereof;

(w) "Plan of Arrangement" means the plan of arrangement attached to this Agreement as Exhibit I, as the same may be amended from time to time;

(x) "Registrar" means the Registrar of Companies under the BCBCA;

(y) "Section 3(a)(10) Exemption" means the registration requirements of the U.S. Securities Act provided by section 3(a)(10) of the U.S. Securities Act;

(z) "Spinco" means Vizsla Royalties Corp., a company existing under the BCBCA;

(aa) "Spinco Options" means share purchase options issued pursuant to the Spinco Stock Option Plan, including the Spinco Options pursuant to Section 3.1(d) of the Plan of Arrangement;



- 4 -

(bb) "Spinco Securities" means the Spinco Shares and the Spinco Warrants collectively;

(cc) "Spinco Shares" means the no par value shares which Spinco is authorized to issue as the same are constituted on the date hereof;

(dd) "Spinco Stock Option Plan" means the stock option plan to be adopted by Spinco in accordance with Section 4.3 of this Agreement on substantially similar terms as the Vizsla Silver Equity Incentive Plan and as may otherwise be modified, amended or restated as more particularly set forth in the Information Circular;

(ee) "Spinco Warrants" means common share purchase warrants of Spinco, each full Spinco Warrant entitling the holder thereof to purchase one Spinco Share at an exercise price of $0.05 for a period expiring on the earlier of (a) 120 days after the Listing Date, and (b) December 31, 2025;

(ff) "Tax Act" means the Income Tax Act (Canada), R.S.C. 1985 (5th Supp.) c.1, as amended;

(gg) "TSXV" means the TSX Venture Exchange Inc.;

(hh) "United States" means the United States of America, its territories and possessions, any state of the United States and the District of Columbia;

(ii) "U.S. Exchange Act" means the United States Securities Exchange Act of 1934;

(jj) "U.S. Securities Act" means the United States Securities Act of 1933, as amended;

(kk) "Vizsla Silver Equity Incentive Plan" means the existing equity incentive plan of Vizsla Silver, as updated and amended from time to time;

(ll) "Vizsla Silver Meeting" means the annual and special meeting of the Vizsla Silver Shareholders and any adjournments thereof to be held to, among other things, consider and, if deemed advisable, approve the Arrangement;

(mm) "Vizsla Silver Options" means options to acquire Vizsla Silver Shares, including options under the terms of which are deemed exercisable for Vizsla Silver Shares, that are outstanding immediately prior to the Effective Time;

(nn) "Vizsla Silver Replacement Option" means an option to acquire a New Vizsla Silver Share to be issued by Vizsla Silver to a holder of a Vizsla Silver Option pursuant to Section 3.1(d) of the Plan of Arrangement;

(oo) "Vizsla Silver Shareholder" means a holder of Vizsla Silver Shares;

(pp) "Vizsla Silver Shares" means the common shares without par value which Vizsla Silver is authorized to issue as the same are constituted on the date hereof; and

(qq) "Vizsla Silver Warrants" means the share purchase warrants of Vizsla Silver exercisable to acquire Vizsla Silver Shares, including warrants under the terms of which are deemed exercisable for Vizsla Silver Shares, which are outstanding immediately prior to the Effective Time.


- 5 -

1.2 Currency. All amounts of money which are referred to in this Agreement are expressed in lawful money of Canada unless otherwise specified.

1.3 Interpretation Not Affected by Headings. The division of this Agreement into articles, sections, subsections, paragraphs and subparagraphs and the insertion of headings are for convenience of reference only and shall not affect the construction or interpretation of the provisions of this Agreement. The terms "this Agreement", "hereof", "herein", "hereunder" and similar expressions refer to this Agreement and the exhibits hereto as a whole and not to any particular article, section, subsection, paragraph or subparagraph hereof and include any agreement or instrument supplementary or ancillary hereto.

1.4 Number and Gender. In this Agreement, unless the context otherwise requires, words importing the singular shall include the plural and vice versa and words importing the use of either gender shall include both genders and neuter and words importing persons shall include firms and corporations.

1.5 Date for any Action. In the event that any date on which any action is required to be taken hereunder by Vizsla Silver or Spinco is not a Business Day in the place where the action is required to be taken, such action shall be required to be taken on the next succeeding day which is a Business Day in such place.

1.6 Meaning. Words and phrases used herein and defined in the BCBCA shall have the same meaning herein as in the BCBCA unless the context otherwise requires.

1.7 Exhibits. Attached hereto and deemed to be incorporated into and form part of this Agreement as Exhibit I is the Plan of Arrangement.

ARTICLE 2

ARRANGEMENT

2.1 Arrangement. The parties agree to effect the Arrangement pursuant to the Arrangement Provisions on the terms and subject to the conditions contained in this Agreement and the Plan of Arrangement.

2.2 Effective Date of Arrangement. The Arrangement shall become effective on the Effective Date as set out in the Plan of Arrangement.

2.3 Commitment to Effect. Subject to termination of this Agreement pursuant to Article 6 hereof, the parties shall each use all reasonable efforts and do all things reasonably required to cause the Plan of Arrangement to become effective, and in conjunction therewith to cause the conditions described in Section 5.1 to be complied with prior to the Effective Date. Without limiting the generality of the foregoing, the parties shall proceed forthwith to apply for the Interim Order and Vizsla Silver shall call the Vizsla Silver Meeting and mail the Information Circular to the Vizsla Silver Shareholders.



- 6 -

2.4 Filing of Final Order. Subject to the rights of termination contained in Article 6 hereof, upon the Vizsla Silver Shareholders approving the Arrangement Resolutions in accordance with the provisions of the Interim Order and the BCBCA, Vizsla Silver obtaining the Final Order and the other conditions contained in Article 5 hereof being complied with or waived, Vizsla Silver on its behalf and on behalf of Spinco shall file with the Registrar:

(a) the records and information required by the Registrar pursuant to the Arrangement Provisions; and

(b) a copy of the Final Order.

2.5 U.S. Securities Law Matters.

(a) The parties agree that the Arrangement will be carried out with the intention that the securities delivered upon completion of the Arrangement to Vizsla Silver Shareholders in the United States will be issued by Vizsla Silver and Spinco in reliance on the Section 3(a)(10) Exemption. In order to ensure the availability of the Section 3(a)(10) Exemption the parties agree that the Arrangement will be carried out on the following basis:

(i) the Arrangement will be subject to the approval of the Court and the Court will hold a hearing approving the fairness of the terms and conditions of the Arrangement;

(ii) prior to the hearing required to approve the Arrangement, the Court will be advised as to the intention of the Parties to rely on the Section 3(a)(10) Exemption;

(iii) the Court will be required to satisfy itself as to the substantive and procedural fairness of the terms and conditions of the Arrangement to the Vizsla Silver Shareholders subject to the Arrangement;

(iv) Vizsla Silver will ensure that each Vizsla Silver Shareholder entitled to receive securities on completion of the Arrangement will be given adequate notice advising them of their right to attend the hearing of the Court to give approval of the Arrangement and providing them with sufficient information necessary for them to exercise that right;

(v) the Vizsla Silver Shareholder entitled to receive securities on completion of the Arrangement will be advised that such securities have not been registered under the U.S. Securities Act and will be issued in reliance on the exemption under Section 3(a)(10) of the U.S. Securities Act;

(vi) the Final Order approving the Arrangement that is obtained from the Court will expressly state that the terms and conditions of the Arrangement is approved by the Court as being fair, substantively and procedurally, to the Vizsla Silver Shareholders;


- 7 -

(vii) the Interim Order approving the Vizsla Silver Meeting will specify that each Vizsla Silver Shareholder will have the right to appear before the Court at the hearing of the Court to give approval of the Arrangement so long as the Vizsla Silver Shareholder enters an appearance within a reasonable time and in accordance with the requirements of Section 3(a)(10) under the U.S. Securities Act; and

(viii) the Final Order shall include a statement substantially to the following effect:

"This Order will serve as a basis of a claim to an exemption, pursuant to Section 3(a)(10) of the United States Securities Act of 1933, as amended, from the registration requirements otherwise imposed by that Act, regarding the issuance of New Vizsla Silver Shares and Spinco Securities pursuant to the Plan of Arrangement."

(b) With respect to any Vizsla Silver Options or Vizsla Silver Warrants outstanding immediately prior to the Effective Date, the issuance of Spinco Shares upon the exercise of such Vizsla Silver Options or Vizsla Silver Warrants held in the U.S. or by U.S. holders after the Effective Date shall not be covered by the Section 3(a)(10) Exemption, and will require the use of an available exemption, if any, from registration under the U.S. Securities Act at the time of such later issuance of such Spinco Shares upon exercise of such Vizsla Silver Options or Vizsla Silver Warrants. This Agreement and the Plan of Arrangement does not contain a discussion of such possible exemptions from registration under the U.S. Securities Act, if any, that could apply to the issuance of Spinco Shares upon the subsequent exercise of such securities. Vizsla Silver securityholders in the United States will be urged to consult with their own legal counsel with respect to matters related to the exercise of Vizsla Silver Options or Vizsla Silver Warrants.

ARTICLE 3

REPRESENTATIONS AND WARRANTIES

3.1 Representations and Warranties. Each of the parties hereby represents and warrants to the other party that:

(a) it is a corporation duly incorporated and validly subsisting under the laws of its jurisdiction of incorporation, and has full capacity and authority to enter into this Agreement and to perform its covenants and obligations hereunder;

(b) it has taken all corporate actions necessary to authorize the execution and delivery of this Agreement and to consummate the transactions contemplated herein and this Agreement has been duly executed and delivered by it;

(c) neither the execution and delivery of this Agreement nor the performance of any of its covenants and obligations hereunder will constitute a material default under, or be in any material contravention or breach of (i) any provision of its Constating Documents or other governing corporate documents, (ii) any judgment, decree, order, law, statute, rule or regulation applicable to it, or (iii) any agreement or instrument to which it is a party or by which it is bound;


- 8 -

(d) no dissolution, winding up, bankruptcy, liquidation or similar proceedings has been commenced or are pending or proposed in respect of it;

(e) it (i) is a "foreign private issuer" as defined in Rule 3b-4 under the U.S. Exchange Act; (ii) has no class of securities outstanding that is or is required to be registered under section 12 of the U.S. Exchange Act or that is subject to the reporting requirements of section 13 or 15(d) of the U.S. Exchange Act; and (iii) is not registered or required to register as an investment company under the United States Investment Company Act of 1940.

ARTICLE 4

COVENANTS

4.1 Covenants. Each of the parties covenants with the other that it will do and perform all such acts and things, and execute and deliver all such agreements, assurances, notices and other documents and instruments, as may reasonably be required to facilitate the carrying out of the intent and purpose of this Agreement.

4.2 Interim Order and Final Order. The parties acknowledge that Vizsla Silver will apply to and obtain from the Court, pursuant to the Arrangement Provisions, the Interim Order providing for, among other things, the calling and holding of the Vizsla Silver Meeting for the purpose of considering and, if deemed advisable, approving and adopting the Arrangement Resolutions. The parties each covenant and agree that if the approval of the Arrangement by the Vizsla Silver Shareholders as set out in Section 5.1(b) hereof is obtained, Vizsla Silver will thereafter (subject to the exercise of any discretionary authority granted to Vizsla Silver's directors) take the necessary actions to submit the Arrangement to the Court for approval and apply for the Final Order and, subject to compliance with any of the other conditions provided for in Article 5 hereof and to the rights of termination contained in Article 6 hereof, file the material described in Section 2.4 with the Registrar.

4.3 Spinco Stock Option Plan. In connection with, but prior to, the Arrangement, Spinco shall adopt the Spinco Stock Option Plan, which shall be substantially in the form attached to the Information Circular.

4.4 Vizsla Silver Options. The parties acknowledge that pursuant to the Arrangement, each Vizsla Silver Option then outstanding to acquire one Vizsla Silver Share shall be transferred and exchanged for:

(a) one Vizsla Silver Replacement Option to acquire one New Vizsla Silver Share having an exercise price equal to the product of the original exercise price of the Vizsla Silver Option multiplied by the fair market value of a New Vizsla Silver Share at the Effective Time divided by the total of the fair market value of a New Vizsla Silver Share and the fair market value of 1/3 of a Spinco Share at the Effective Time; and

(b) one Spinco Option to acquire 1/3 of a Spinco Share, each whole Spinco Option having an exercise price equal to the product of the original exercise price of the Vizsla Silver Option multiplied by the fair market value of 1/3 of a Spinco Share at the Effective Time divided by the total of the fair market value of one New Vizsla Silver Share and 1/3 of a Spinco Share at the Effective Time,


- 9 -

provided that the aforesaid exercise prices shall be adjusted to the extent, if any, required to ensure that the aggregate In the Money Amount of the Vizsla Silver Replacement Option and the Spinco Option immediately after the exchange does not exceed the In the Money Amount immediately before the exchange of the Vizsla Silver Option so exchanged and solely with respect to U.S. taxpayers, ensure compliance with applicable provisions of the Internal Revenue Code of 1986, as amended. It is intended that subsection 7(1.4) of the Tax Act apply to the exchange of Vizsla Silver Options; and Spinco agrees to promptly issue Spinco Shares upon the due exercise of Spinco Options.

4.5 Vizsla Silver Warrants. The parties acknowledge that, from and after the Effective Date, all Vizsla Silver Warrants shall entitle the holder to receive, upon due exercise of the Vizsla Silver Warrant, for the original exercise price:

(a) one New Vizsla Silver Share for each Vizsla Silver Share that was issuable upon due exercise of the Vizsla Silver Warrant immediately prior to the Effective Time; and

(b) 1/3 of a Spinco Share for each Vizsla Silver Share that was issuable upon due exercise of the Vizsla Silver Warrant immediately prior to the Effective Time;

and Spinco hereby covenants that it shall forthwith upon receipt of written notice from Vizsla Silver from time to time issue, as directed by Vizsla Silver, that number of Spinco Shares as may be required to satisfy the foregoing.

Vizsla Silver shall, as agent for Spinco, collect and pay to Spinco an amount for each 1/3 of a Spinco Share so issued that is equal to the exercise price under the Vizsla Silver Warrant multiplied by the fair market value of 1/3 of a Spinco Share at the Effective Time divided by the total market value of one New Vizsla Silver Share and 1/3 of a Spinco Share at the Effective Time.

4.6 Fair Market Value. For the purposes of this Agreement and the Plan of Arrangement, the fair market value of the New Vizsla Shares and the Spinco Shares will be determined by Board of Directors, acting in good faith.

ARTICLE 5

CONDITIONS

5.1 Conditions Precedent. The respective obligations of the parties to complete the transactions contemplated by this Agreement shall be subject to the satisfaction of the following conditions:

(a) the Interim Order shall have been obtained in form and substance satisfactory to Vizsla Silver;

(b) the Arrangement Resolutions, with or without amendment, shall have been approved and adopted at the Vizsla Silver Meeting in accordance with the Arrangement Provisions, the Constating Documents of Vizsla Silver, the Interim Order and the requirements of any applicable regulatory authorities;


- 10 -

(c) the Final Order shall have been obtained in form and substance satisfactory to each of Vizsla Silver and Spinco;

(d) the TSXV shall have conditionally approved the Arrangement, subject to compliance with the requirements of the TSXV;

(e) all other consents, orders, regulations and approvals, including regulatory and judicial approvals and orders required or necessary or desirable for the completion of the transactions provided for in this Agreement and the Plan of Arrangement shall have been obtained or received from the Persons, authorities or bodies having jurisdiction in the circumstances each in form acceptable to Vizsla Silver and Spinco;

(f) there shall not be in force any order or decree restraining or enjoining the consummation of the transactions contemplated by this Agreement and the Plan of Arrangement;

(g) no law, regulation or policy shall have been proposed, enacted, promulgated or applied which interferes or is inconsistent with the completion of the Arrangement and Plan of Arrangement, including any material change to the income tax laws of Canada, which would reasonably be expected to have a material adverse effect on any of Vizsla Silver, the Vizsla Silver Shareholders or Spinco if the Arrangement is completed;

(h) notices of dissent pursuant to Article 5 of the Plan of Arrangement shall not have been delivered by Vizsla Silver Shareholders holding greater than 5% of the outstanding Vizsla Silver Shares;

(i) the New Vizsla Silver Shares and the Spinco Securities to be issued to Vizsla Silver Shareholders in the United States under the Arrangement will be exempt from the registration requirements of the U.S. Securities Act under the Section 3(a)(10) Exemption (or will otherwise be exempt from, or not subject to, registration requirements); and

(j) this Agreement shall not have been terminated under Article 6 hereof.

Except for the conditions set forth in Sections 5.1(a), (b), (c), (d) and (j), which may not be waived, any of the other conditions in this Section 5.1 may be waived by either Vizsla Silver or Spinco at its discretion.

5.2 Pre-Closing. Unless this Agreement is terminated earlier pursuant to the provisions hereof, the parties shall meet at the offices of Forooghian + Company Law Corporation, Suite 401, 353 Water Street, Vancouver, British Columbia V6B 1B8, at 9:00 a.m. on the Business Day immediately preceding the Effective Date, or at such other location or at such other time or on such other date as they may mutually agree, and each of them shall deliver to the other of them:

(a) the documents required to be delivered by it hereunder to complete the transactions contemplated hereby, provided that each such document required to be dated the Effective Date shall be dated as of, or become effective on, the Effective Date and shall be held in escrow to be released upon the occurrence of the Effective Date; and 


- 11 -

(b) written confirmation as to the satisfaction or waiver by it of the conditions in its favour contained in this Agreement.

5.3 Merger of Conditions. The conditions set out in Section 5.1 hereof shall be conclusively deemed to have been satisfied, waived or released upon the occurrence of the Effective Date.

5.4 Merger of Representations, Warranties and Covenants. The representations and warranties in Section 3.1 shall be conclusively deemed to be correct as of the Effective Date and the covenants in Section 4.1 hereof shall be conclusively deemed to have been complied with in all respects as of the Effective Date, and each shall accordingly merge in and not survive the effectiveness of the Arrangement.

ARTICLE 6

AMENDMENT AND TERMINATION

6.1 Amendment. Subject to any mandatory applicable restrictions under the Arrangement Provisions or the Final Order, this Agreement, including the Plan of Arrangement, may at any time and from time to time before or after the holding of the Vizsla Silver Meeting, but prior to the Effective Date, be amended by the written agreement of the parties hereto without, subject to applicable law, further notice to or authorization on the part of the Vizsla Silver Shareholders.

6.3 Termination. Subject to Section 6.4, this Agreement may at any time before or after the holding of the Vizsla Silver Meeting, and before or after the granting of the Final Order, but in each case prior to the Effective Date, be terminated by direction of the Board of Directors of Vizsla Silver without further action on the part of the Vizsla Silver Shareholders and nothing expressed or implied herein or in the Plan of Arrangement shall be construed as fettering the absolute discretion by the Board of Directors of Vizsla Silver to elect to terminate this Agreement and discontinue efforts to effect the Arrangement for whatever reasons it may consider appropriate.

6.4 Cessation of Right. The right of Vizsla Silver or Spinco or any other party to amend or terminate the Plan of Arrangement pursuant to Section 6.1 and Section 6.3 shall be extinguished upon the occurrence of the Effective Date.

ARTICLE 7

GENERAL

7.1 Notices. All notices which may or are required to be given pursuant to any provision of this Agreement shall be given or made in writing and shall be delivered or sent by fax or, addressed as follows:


- 12 -

in the case of Vizsla Silver:

Vizsla Silver Corp.

PO Box 49193

595 Burrard Street

Vancouver, British Columbia

V7X 1K8

Attention:

Chief Executive Officer

in the case of Spinco:

Vizsla Royalties Corp.

PO Box 49193

595 Burrard Street

Vancouver, British Columbia

V7X 1K8

Attention:

Chief Executive Officer

in each case with a copy to:

Forooghian + Company Law Corporation

Suite 401 - 353 Water Street

Vancouver, British Columbia

V6B 1B8

Attention:

Farzad Forooghian

Email:

[Redacted - Email Address]

7.2 Assignment. Neither of the parties may assign its rights or obligations under this Agreement or the Arrangement without the prior written consent of the other.

7.3 Binding Effect. This Agreement and the Arrangement shall be binding upon and shall enure to the benefit of the parties and their respective successors and permitted assigns.

7.4 Waiver. Any waiver or release of the provisions of this Agreement, to be effective, must be in writing and executed by the party granting such waiver or release.

7.5 Governing Law. This Agreement shall be governed by and be construed in accordance with the laws of the Province of British Columbia and the laws of Canada applicable therein.

7.6 Counterparts This Agreement may be executed in one or more counterparts, each of which shall be deemed to be an original but all of which together shall constitute one and the same instrument.


- 13 -

7.7 Expenses. All expenses incurred by a party in connection with this Agreement, the Arrangement and the transactions contemplated hereby and thereby shall be borne by the party that incurred the expense or as otherwise mutually agreed by the parties.

7.8 Entire Agreement. This Agreement constitutes the entire agreement between the parties with respect to the subject matter of this Agreement and supersedes all prior and contemporaneous agreements, understandings, negotiations and discussions, whether oral or written, of the parties.

7.9 Time of Essence. Time is of the essence of this Agreement.

[Remainder of page has been left intentionally blank] 

 


- 14 -

IN WITNESS WHEREOF the parties have executed this Agreement as of the date first above written.

VIZSLA SILVER CORP.

(signed) "Michael Konnert"                               
Authorized Signatory

VIZSLA ROYALTIES CORP.

(signed) "Michael Pettingell"                             
Authorized Signatory



EXHIBIT I

TO THE ARRANGEMENT AGREEMENT

DATED AS OF MARCH 27, 2024

BETWEEN VIZSLA SILVER CORP.

AND VIZSLA ROYALTIES CORP.

PLAN OF ARRANGEMENT

UNDER PART 9, DIVISION 5 OF

THE BUSINESS CORPORATIONS ACT (BRITISH COLUMBIA)

ARTICLE 1

DEFINITIONS AND INTERPRETATION

1.1Definitions

In this plan of arrangement, unless there is something in the subject matter or context inconsistent therewith, the following capitalized words and terms shall have the following meanings:

(a) "Arrangement" means the arrangement pursuant to the Arrangement Provisions on the terms and conditions set out herein;

(b) "Arrangement Agreement" means the arrangement agreement dated as of March 27, 2024 between Vizsla Silver and Spinco, as may be supplemented or amended from time to time;

(c) "Arrangement Provisions" means Part 9, Division 5 of the BCBCA;

(d) "Arrangement Resolutions" means the special resolutions of the Vizsla Silver Shareholders to approve the Arrangement, as required by the Interim Order and the BCBCA;

(e) "BCBCA" means the Business Corporations Act, S.B.C. 2002, c. 57, as amended;

(f) "Board of Directors" means the current and existing board of directors of Vizsla Silver;

(g) "Business Day" means a day which is not a Saturday, Sunday or statutory holiday in Vancouver, British Columbia;

(h) "Court" means the Supreme Court of British Columbia;

(i) "Depositary" means Computershare Investor Services Inc., or such other depositary as Vizsla Silver may determine;

(j) "Dissent Procedures" means the rules pertaining to the exercise of Dissent Rights as set forth in Division 2 of Part 8 of the BCBCA and Article 5 of this Plan of Arrangement;

(k) "Dissent Rights" means the rights of dissent granted in favour of registered holders of Vizsla Silver Shares in accordance with Article 5 of this Plan of Arrangement;


- 2 -

(l) "Dissenting Share" has the meaning given in Section 3.1(a) of this Plan of Arrangement;

(m) "Dissenting Shareholder" means a registered holder of Vizsla Silver Shares who dissents in respect of the Arrangement in strict compliance with the Dissent Procedures and who has not withdrawn or been deemed to have withdrawn such exercise of Dissent Rights;

(n) "Effective Date" shall be the date of the closing of the Arrangement;

(o) "Effective Time" means 12:01 a.m. (Vancouver time) on the Effective Date or such other time on the Effective Date as agreed to in writing by Vizsla Silver and Spinco;

(p) "Final Order" means the final order of the Court, after being informed of the intention to rely upon the Section 3(a)(10) Exemption and similar exemptions from applicable United States securities laws with respect to the issuance of the New Vizsla Silver Shares and the Spinco Securities to be issued pursuant to the Arrangement to Vizsla Silver Shareholders in the United States, approving the Arrangement;

(q) "In the Money Amount" at a particular time with respect to a Vizsla Silver Option, Vizsla Silver Replacement Option or Spinco Option means the amount, if any, by which the fair market value of the underlying security exceeds the exercise price of the relevant option at such time;

(r) "Information Circular" means the management information circular of Vizsla Silver, including all schedules thereto, to be sent to the Vizsla Silver Shareholders in connection with the Vizsla Silver Meeting, together with any amendments or supplements thereto;

(s) "Interim Order" means the interim order of the Court, after being informed of the intention to rely upon the Section 3(a)(10) Exemption and similar exemptions from applicable United States securities laws with respect to the issuance of the New Vizsla Silver Shares and the Spinco Securities to be issued pursuant to the Arrangement to Vizsla Silver Shareholders in the United States, providing advice and directions in connection with the Vizsla Silver Meeting and the Arrangement;

(t) "Letter of Transmittal" means the letter of transmittal in respect of the Arrangement to be sent to Vizsla Silver Shareholders together with the Information Circular;

(u) "Listing Date" means the date on which the Spinco Shares and Spinco Warrants are listed for trading on the TSXV or another recognized stock exchange;

(v) "New Vizsla Silver Shares" means a new class of voting common shares without par value which Vizsla Silver will create and issue as described in Section 3.1(b)(ii) of this Plan of Arrangement and for which the Vizsla Silver Class A Shares are, in part, to be exchanged under the Plan of Arrangement and which, immediately after completion of the transactions comprising the Plan of Arrangement, will be identical in every relevant respect to the Vizsla Silver Shares;

(w) "Plan of Arrangement" means this plan of arrangement, as the same may be amended from time to time;


- 3 -

(x) "Registrar" means the Registrar of Companies under the BCBCA;

(y) "Section 3(a)(10) Exemption" means the registration requirements of the U.S. Securities Act provided by section 3(a)(10) of the U.S. Securities Act;

(z) "Share Distribution Record Date" means the close of business on the Business Day immediately preceding the Effective Date for the purpose of determining the Vizsla Silver Shareholders entitled to receive New Vizsla Silver Shares and Spinco Securities pursuant to this Plan of Arrangement or such other date as the Board of Directors may select;

(aa) "Spinco" means Vizsla Royalties Corp., a company existing under the BCBCA;

(bb) "Spinco Options" means share purchase options issued pursuant to the Spinco Stock Option Plan, including the Spinco Options pursuant to Section 3.1(d) of this Plan of Arrangement;

(cc) "Spinco Shareholder" means a holder of Spinco Shares;

(dd) "Spinco Shares" means the no par value shares which Spinco is authorized to issue as the same are constituted on the date hereof;

(ee) "Spinco Stock Option Plan" means the stock option plan to be adopted by Spinco pursuant to the Arrangement Agreement and this Plan of Arrangement, in substantially the form set forth in the Information Circular to be sent to Vizsla Silver Shareholders in connection with the Vizsla Silver Meeting;

(ff) "Spinco Warrants" means common share purchase warrants of Spinco, each full Spinco Warrant entitling the holder thereof to purchase one Spinco Share at an exercise price of $0.05 for a period expiring on the earlier of (a) 120 days after the Listing Date, and (b) December 31, 2025;

(gg) "Tax Act" means the Income Tax Act (Canada), R.S.C. 1985 (5th Supp.) c.1, as amended;

(hh) "TSXV" means the TSX Venture Exchange Inc.;

(ii) "U.S. Securities Act" means the United States Securities Act of 1933, as amended;

(jj) "Vizsla Silver" means Vizsla Silver Corp., a corporation existing under the BCBCA;

(kk) "Vizsla Silver Class A Shares" means the renamed and redesignated Vizsla Silver Shares as described in Section 3.1(b)(i) of this Plan of Arrangement;

(ll) "Vizsla Silver Meeting" means the annual and special meeting of the Vizsla Silver Shareholders and any adjournments thereof to be held to, among other things, consider and, if deemed advisable, approve the Arrangement;

(mm) "Vizsla Silver Optionholders" means the holders of Vizsla Silver Options on the Effective Date;

(nn) "Vizsla Silver Options" means options to acquire Vizsla Silver Shares, including options under the terms of which are deemed exercisable for Vizsla Silver Shares, that are outstanding immediately prior to the Effective Time;


- 4 -

(oo) "Vizsla Silver Replacement Option" means an option to acquire a New Vizsla Silver Share to be issued by Vizsla Silver to a holder of a Vizsla Silver Option pursuant to Section 3.1(d) of this Plan of Arrangement;

(pp) "Vizsla Silver Shareholder" means a holder of Vizsla Silver Shares;

(qq) "Vizsla Silver Shares" means the common shares without par value which Vizsla Silver is authorized to issue as the same are constituted on the date hereof;

(rr) "Vizsla Silver Warrantholders" means the holders of Vizsla Silver Warrants on the Effective Date; and

(ss) "Vizsla Silver Warrants" means the share purchase warrants of Vizsla Silver exercisable to acquire Vizsla Silver Shares, including warrants under the terms of which are deemed exercisable for Vizsla Silver Shares, that are outstanding immediately prior to the Effective Time.

1.2Interpretations not Affected by Headings. The division of this Plan of Arrangement into articles, sections, subsections, paragraphs and subparagraphs and the insertion of headings are for convenience of reference only and shall not affect the construction or interpretation of this Plan of Arrangement. Unless otherwise specifically indicated, the terms "this Plan of Arrangement", "hereof", "hereunder" and similar expressions refer to this Plan of Arrangement as a whole and not to any particular article, section, subsection, paragraph or subparagraph and include any agreement or instrument supplementary or ancillary hereto.

1.3Number, Gender and Persons. Unless the context otherwise requires, words importing the singular number only shall include the plural and vice versa, words importing the use of either gender shall include both genders and neuter and words importing persons shall include firms and corporations.

1.4                      Meaning. Words and phrases used herein and defined in the BCBCA shall have the same meaning herein as in the BCBCA, unless the context otherwise requires.

1.5                       Date for any Action. If any date on which any action is required to be taken under this Plan of Arrangement is not a Business Day, such action shall be required to be taken on the next succeeding Business Day.

1.6Governing Law. This Plan of Arrangement shall be governed by and construed in accordance with the laws of the Province of British Columbia and the federal laws of Canada applicable therein.

ARTICLE 2
ARRANGEMENT AGREEMENT

2.1                        Arrangement Agreement. This Plan of Arrangement is made pursuant and subject to the provisions of the Arrangement Agreement.

2.2                        Arrangement Effectiveness. The Arrangement and this Plan of Arrangement shall become final and conclusively binding on Vizsla Silver, the Vizsla Silver Shareholders (including Dissenting Shareholders), Vizsla Silver Optionholders, Vizsla Silver Warrantholders and Spinco at the Effective Time without any further act or formality as required on the part of any person, except as expressly provided herein.


- 5 -

ARTICLE 3
THE ARRANGEMENT

3.1                        The Arrangement. Commencing at the Effective Time, the following shall occur and be deemed to occur in the following chronological order without further act or formality notwithstanding anything contained in the provisions attaching to any of the securities of Vizsla Silver or Spinco, but subject to the provisions of Article 5:

(a) each Vizsla Silver Share outstanding in respect of which a Dissenting Shareholder has validly exercised his, her or its Dissent Rights (each, a "Dissenting Share") shall be directly transferred and assigned by such Dissenting Shareholder to Vizsla Silver, without any further act or formality and free and clear of any liens, charges and encumbrances of any nature whatsoever, and will be cancelled and cease to be outstanding and such Dissenting Shareholders will cease to have any rights as Shareholders other than the right to be paid the fair value for their Vizsla Silver Shares by Vizsla Silver;

(b) the authorized share structure of Vizsla Silver shall be altered by:

(i) renaming and redesignating all of the issued and unissued Vizsla Silver Shares as "Class A common shares without par value" and amending the special rights and restrictions attached to those shares to provide the holders thereof with two votes in respect of each share held, being the "Vizsla Silver Class A Shares"; and

(ii) creating a new class consisting of an unlimited number of "common shares without par value" with terms and special rights and restrictions identical to those of the Vizsla Silver Shares immediately prior to the Effective Time, being the

"New Vizsla Silver Shares";

(c) Vizsla Silver's Notice of Articles shall be amended to reflect the alterations in Section 3.1(b);

(d) each Vizsla Silver Option then outstanding to acquire one Vizsla Silver Share shall be transferred and exchanged for:

(i) one Vizsla Silver Replacement Option to acquire one New Vizsla Silver Share having an exercise price equal to the product of the original exercise price of the Vizsla Silver Option multiplied by the fair market value of a New Vizsla Silver Share at the Effective Time divided by the total of the fair market value of a New Vizsla Silver Share and the fair market value of 1/3 of a Spinco Share at the Effective Time; and

(ii) one Spinco Option to acquire 1/3 of a Spinco Share, each whole Spinco Option having an exercise price equal to the product of the original exercise price of the Vizsla Silver Option multiplied by the fair market value 1/3 of a Spinco Share at the Effective Time divided by the total of the fair market value of one New Vizsla Silver Share and 1/3 of a Spinco Share at the Effective Time,


- 6 -

provided that the aforesaid exercise prices shall be adjusted to the extent, if any, required to ensure that the aggregate In the Money Amount of the Vizsla Silver Replacement Option and the Spinco Option immediately after the exchange does not exceed the In the Money Amount immediately before the exchange of the Vizsla Silver Option so exchanged and solely with respect to U.S. taxpayers, ensure compliance with applicable provisions of the Internal Revenue Code of 1986, as amended. It is intended that subsection 7(1.4) of the Tax Act apply to the exchange of Vizsla Silver Options;

(e) each Vizsla Silver Warrant then outstanding shall be deemed to be amended to entitle the Vizsla Silver Warrantholder to receive, upon due exercise of the Vizsla Silver Warrant, for the original exercise price:

(i) one New Vizsla Silver Share for each Vizsla Silver Share that was issuable upon due exercise of the Vizsla Silver Warrant immediately prior to the Effective Time; and

(ii) 1/3 of a Spinco Share for each Vizsla Silver Share that was issuable upon due exercise of the Vizsla Silver Warrant immediately prior to the Effective Time;

(f) each issued and outstanding Vizsla Silver Class A Share outstanding on the Share Distribution Record Date shall be exchanged for: (i) one New Vizsla Silver Share; (ii) 1/3 of a Spinco Share; and (iii) 1/3 of a Spinco Warrant. The holders of the Vizsla Silver Class A Shares will be removed from the central securities register of Vizsla Silver as the holders of such and will be added to the central securities register of Vizsla Silver as the holders of the number of New Vizsla Silver Shares that they have received on the exchange set forth in this Section 3.1(f), and the Spinco Shares and Spinco Warrants transferred to the then holders of the Vizsla Silver Class A Shares will be registered in the name of the former holders of the Vizsla Silver Class A Shares and Vizsla Silver will provide Spinco and its registrar and transfer agent notice to make the appropriate entries in the central securities register of Spinco;

(g) all of the issued Vizsla Silver Class A Shares shall be cancelled with the appropriate entries being made in the central securities register of Vizsla Silver and the authorized share structure of Vizsla Silver shall be altered by eliminating the "Vizsla Silver Class A Shares", and the aggregate paid-up capital (as that term is used for purposes of the Tax Act) of the New Vizsla Silver Shares will be equal to that of the Vizsla Silver Shares immediately prior to the Effective Time less the fair market value of the Spinco Shares and Spinco Warrants distributed pursuant to Section 3.1(f); and

(h) the Notice of Articles of Vizsla Silver shall be amended to reflect the alterations in Section 3.1(g).

3.2No Fractional Securities. Notwithstanding any other provision of this Arrangement, while each Vizsla Silver Shareholder's fractional shares and each holder of Vizsla Silver Options fractional options, respectively, will be combined, no fractional Spinco Securities shall be distributed to the Vizsla Silver Shareholders and no fractional Spinco Options shall be distributed to the holders of Vizsla Silver Options, and, as a result, all fractional amounts arising under this Plan of Arrangement shall be rounded down to the next whole number without any compensation therefor. Any Spinco Securities not distributed as a result of so rounding down shall be cancelled by Spinco.  



- 7 -

3.3Share Distribution Record Date. In Section 3.1(f) the reference to a holder of a Vizsla Silver Class A Share shall mean a person who is a Vizsla Silver Shareholder on the Share Distribution Record Date, subject to the provisions of Article 5.

3.4Deemed Fully Paid and Non-Assessable Shares. All New Vizsla Silver Shares,

Vizsla Silver Class A Shares and Spinco Shares issued pursuant hereto shall be deemed to be validly issued and outstanding as fully paid and non-assessable shares for all purposes of the

BCBCA.

3.5Supplementary Actions. Notwithstanding that the transactions and events set out in Section 3.1 shall occur and shall be deemed to occur in the chronological order therein set out without any act or formality, each of Vizsla Silver and Spinco shall be required to make, do and execute or cause and procure to be made, done and executed all such further acts, deeds, agreements, transfers, assurances, instruments or documents as may be required to give effect to, or further document or evidence, any of the transactions or events set out in Section 3.1, including, without limitation, any resolutions of directors authorizing the issue, transfer or redemption of shares, any share transfer powers evidencing the transfer of shares and any receipt therefor, any necessary additions to or deletions from share registers, and agreements for stock options.

3.6Withholding. Each of Vizsla Silver, Spinco and the Depositary shall be entitled to deduct and withhold from any cash payment or any issue, transfer or distribution of New Vizsla Silver Shares and Spinco Securities, Vizsla Silver Replacement Options or Spinco Options made pursuant to this Plan of Arrangement such amounts as may be required to be deducted and withheld pursuant to the Tax Act or any other applicable law, and any amount so deducted and withheld will be deemed for all purposes of this Plan of Arrangement to be paid, issued, transferred or distributed to the person entitled thereto under the Plan of Arrangement. Without limiting the generality of the foregoing, any New Vizsla Silver Shares or Spinco Securities so deducted and withheld may be sold on behalf of the person entitled to receive them for the purpose of generating cash proceeds, net of brokerage fees and other reasonable expenses, sufficient to satisfy all remittance obligations relating to the required deduction and withholding, and any cash remaining after such remittance shall be paid to the person forthwith.

3.7No Liens. Any exchange or transfer of securities pursuant to this Plan of Arrangement shall be free and clear of any liens, restrictions, adverse claims or other claims of third parties of any kind.

3.8U.S. Securities Law Matters. The Court is advised that the Arrangement will be carried out with the intention that all securities issued on completion of the Arrangement will be issued in reliance on the exemption from the registration requirements of the U.S. Securities Act provided by the Section 3(a)(10) Exemption.


- 8 -

ARTICLE 4
CERTIFICATES

4.1                        Vizsla Silver Class A Shares. Recognizing that the Vizsla Silver Shares shall be renamed and re-designated as Vizsla Silver Class A Shares pursuant to Section 3.1(b)(i) and that the Vizsla Silver Class A Shares shall be exchanged partially for New Vizsla Silver Shares pursuant to Section 3.1(f), Vizsla Silver shall not issue replacement share certificates representing the Vizsla Silver Class A Shares.

4.2Spinco Share Certificates and Spinco Warrant Certificates. As soon as practicable following the Effective Date, Spinco shall deliver or cause to be delivered to the Depositary certificates representing the Spinco Shares and Spinco Warrants required to be issued to registered holders of Vizsla Silver Shares as at immediately prior to the Effective Time in accordance with the provisions of Section 3.1(f) of this Plan of Arrangement, which certificates shall be held by the Depositary as agent and nominee for such holders for distribution thereto in accordance with the provisions of Section 6.1 hereof.

4.3New Vizsla Silver Share Certificates. As soon as practicable following the Effective Date, Vizsla Silver shall deliver or cause to be delivered to the Depositary certificates representing the New Vizsla Silver Shares required to be issued to registered holders of Vizsla Silver Shares as at immediately prior to the Effective Time in accordance with the provisions of Section 3.1(f) of this Plan of Arrangement, which certificates shall be held by the Depositary as agent and nominee for such holders for distribution thereto in accordance with the provisions of Section 6.1 hereof.

4.4Interim Period. Any Vizsla Silver Shares traded after the Share Distribution Record Date will represent New Vizsla Silver Shares as of the Effective Date and shall not carry any rights to receive Spinco Shares or Spinco Warrants.

4.5Stock Option Agreements. The stock option agreements for the Vizsla Silver Options shall be deemed to be amended by Vizsla Silver to reflect the adjusted exercise price of the Vizsla Silver Replacement Options, and Spinco shall enter into stock option agreements for the Spinco Options issued pursuant to Section 3.1(d) of this Plan of Arrangement.

ARTICLE 5
DISSENT RIGHTS

5.1                        Dissent Right. Registered holders of Vizsla Silver Shares may exercise Dissent Rights with respect to their Vizsla Silver Shares in connection with the Arrangement pursuant to the Interim Order and in the manner set forth in the Dissent Procedures, as they may be amended by the Interim Order, Final Order or any other order of the Court, and provided that such dissenting Shareholder delivers a written notice of dissent to Vizsla Silver at least two Business Days before the day of the Vizsla Silver Meeting or any adjournment or postponement thereof.

5.2Dealing with Dissenting Shares. Vizsla Silver Shareholders who duly exercise Dissent Rights with respect to their Dissenting Shares and who:



- 9 -

(a) are ultimately entitled to be paid fair value for their Dissenting Shares by Vizsla Silver shall be deemed to have transferred their Dissenting Shares to Vizsla Silver for cancellation as of the Effective Time pursuant to Section 3.1(a); or

(b) for any reason are ultimately not entitled to be paid for their Dissenting Shares, shall be deemed to have participated in the Arrangement on the same basis as a non-dissenting Vizsla Silver Shareholder and shall receive New Vizsla Silver Shares and Spinco Securities on the same basis as every other non-dissenting Vizsla Silver Shareholder;

but in no case shall Vizsla Silver be required to recognize such persons as holding Vizsla Silver Shares on or after the Effective Date.

5.3Reservation of Spinco Securities. If a Vizsla Silver Shareholder exercises Dissent Rights, Vizsla Silver shall, on the Effective Date, set aside and not distribute that portion of the Spinco Securities which are attributable to the Vizsla Silver Shares for which Dissent Rights have been exercised. If the dissenting Vizsla Silver Shareholder is ultimately not entitled to be paid for their Dissenting Shares, Vizsla Silver shall distribute to such Vizsla Silver Shareholder his or her pro rata portion of the Spinco Securities. If a Vizsla Silver Shareholder duly complies with the Dissent Procedures and is ultimately entitled to be paid for their Dissenting Shares, then Vizsla Silver shall retain the portion of the Spinco Securities attributable to such Vizsla Silver Shareholder and such shares and warrants will be dealt with as determined by the Board of Directors of Vizsla Silver in its discretion.

ARTICLE 6
DELIVERY OF CONSIDERATION

6.1                        Delivery of Shares.

(a) Upon surrender to the Depositary for cancellation of a certificate that immediately before the Effective Time represented one or more outstanding Vizsla Silver Shares, together with a duly completed and executed Letter of Transmittal and such additional documents and instruments as the Depositary may reasonably require, the holder of such surrendered certificate will be entitled to receive in exchange therefor, and the Depositary shall deliver to such holder following the Effective Time, a certificate representing the New Vizsla Silver Shares, a certificate representing the Spinco Shares and a certificate representing the Spinco Warrants that such holder is entitled to receive in accordance with Section 3.1 hereof.

(b) After the Effective Time and until surrendered for cancellation as contemplated by Section 6.1(a) hereof, each certificate that immediately prior to the Effective time represented one or more Vizsla Silver Shares shall be deemed at all times to represent only the right to receive in exchange therefor a certificate representing the New Vizsla Silver Shares, a certificate representing the Spinco Shares and a certificate representing the Spinco Warrants that such holder is entitled to receive in accordance with Section 3.1 hereof.

6.2Lost Certificates. If any certificate that immediately prior to the Effective Time represented one or more outstanding Vizsla Silver Shares that were exchanged for New Vizsla Silver Shares, Spinco Shares and Spinco Warrants in accordance with Section 3.1 hereof, shall have been lost, stolen or destroyed, upon the making of an affidavit of that fact by the holder claiming such certificate to be lost, stolen or destroyed, the Depositary shall deliver in exchange for such lost, stolen or destroyed certificate, the New Vizsla Silver Shares, Spinco Shares and Spinco Warrants that such holder is entitled to receive in accordance with Section 3.1 hereof. When authorizing such delivery of New Vizsla Silver Shares, Spinco Shares and Spinco Warrants that such holder is entitled to receive in exchange for such lost, stolen or destroyed certificate, the holder to whom such securities are to be delivered shall, as a condition precedent to the delivery of such New Vizsla Silver Shares, Spinco Shares and Spinco Warrants give a bond satisfactory to Vizsla Silver, Spinco and the Depositary in such amount as Vizsla Silver, Spinco and the Depositary may direct, or otherwise indemnify Vizsla Silver, Spinco and the Depositary in a manner satisfactory to Vizsla Silver, Spinco and the Depositary, against any claim that may be made against Vizsla Silver, Spinco or the Depositary with respect to the certificate alleged to have been lost, stolen or destroyed and shall otherwise take such actions as may be required by the articles of Vizsla Silver.



- 10 -

6.3Distributions with respect to Unsurrendered Certificates. No dividend or other distribution declared or made after the Effective Time with respect to New Vizsla Silver Shares or Spinco Securities with a record date after the Effective Time shall be delivered to the holder of any unsurrendered certificate that, immediately prior to the Effective Time, represented outstanding Vizsla Silver Shares unless and until the holder of such certificate shall have complied with the provisions of Section 6.1 or 6.2 hereof. Subject to applicable law and to Section 3.6 hereof, at the time of such compliance, there shall, in addition to the delivery of the New Vizsla Silver Shares and Spinco Securities to which such holder is thereby entitled, be delivered to such holder, without interest, the amount of the dividend or other distribution with a record date after the Effective Time theretofore paid with respect to such New Vizsla Silver Shares and/or Spinco Securities, as applicable.

6.4Limitation and Proscription. To the extent that a former Vizsla Silver Shareholder shall not have complied with the provisions of Section 6.1 or 6.2 hereof, as applicable, on or before the date that is six years after the Effective Date (the "Final Proscription Date"), then the New Vizsla Silver Shares and Spinco Securities that such former Vizsla Silver Shareholder was entitled to receive shall be automatically cancelled without any repayment of capital in respect thereof and the New Vizsla Silver Shares and Spinco Securities to which such Vizsla Silver Shareholder was entitled, shall be delivered to Spinco (in the case of the Spinco Securities) or Vizsla Silver (in the case of the New Vizsla Silver Shares) by the Depositary and certificates representing such New Vizsla Silver Shares and Spinco Securities shall be cancelled by Vizsla Silver and Spinco, as applicable, and the interest of the former Vizsla Silver Shareholder in such New Vizsla Silver Shares and Spinco Securities or to which it was entitled shall be terminated as of such Final Proscription Date.

6.5Paramountcy. From and after the Effective Time: (i) this Plan of Arrangement shall take precedence and priority over any and all Vizsla Silver Shares, Vizsla Silver Options or Vizsla Silver Warrants issued prior to the Effective Time; and (ii) the rights and obligations of the registered holders of Vizsla Silver Shares, Vizsla Silver Options, Vizsla Silver Warrants, Spinco, the Depositary and any transfer agent or other depositary therefor, shall be solely as provided for in this Plan of Arrangement.


ARTICLE 7
AMENDMENTS

7.1                        Amendments. Vizsla Silver, in its sole discretion, reserves the right to amend, modify and/or supplement this Plan of Arrangement from time to time at any time prior to the Effective Time provided that any such amendment, modification or supplement must be contained in a written document that is filed with the Court and, if made following the Vizsla Silver Meeting, approved by the Court.

7.2Amendments Made Prior to or at the Vizsla Silver Meeting. Any amendment, modification or supplement to this Plan of Arrangement may be proposed by Vizsla Silver at any time prior to or at the Vizsla Silver Meeting with or without any prior notice or communication, and if so proposed and accepted by the Vizsla Silver Shareholders voting at the Vizsla Silver Meeting, shall become part of this Plan of Arrangement for all purposes.

7.3Amendments Made After the Vizsla Silver Meeting. Any amendment, modification or supplement to this Plan of Arrangement may be proposed by Vizsla Silver after the Vizsla Silver Meeting but prior to the Effective Time and any such amendment, modification or supplement which is approved by the Court following the Vizsla Silver Meeting shall be effective and shall become part of the Plan of Arrangement for all purposes. Notwithstanding the foregoing, any amendment, modification or supplement to this Plan of Arrangement may be made following the granting of the Final Order unilaterally by Vizsla Silver, provided that it concerns a matter which, in the reasonable opinion of Vizsla Silver, is of an administrative nature required to better give effect to the implementation of this Plan of Arrangement and is not adverse to the financial or economic interests of any holder of New Vizsla Silver Shares or Spinco Securities.

7.4Withdrawal. Notwithstanding any prior approvals by the Court or by Vizsla Silver Shareholders, the Board of Directors may decide not to proceed with the Arrangement and to revoke the Arrangement Resolutions at any time prior to the Effective Time, without further approval of the Court or the Vizsla Silver Shareholders.


SCHEDULE "D"

INTERIM ORDER

(Please see attached)

 












SCHEDULE "E"

NOTICE OF HEARING FOR FINAL ORDER

(Please see attached)

 



No.         S243132

Vancouver Registry

IN THE SUPREME COURT OF BRITISH COLUMBIA

IN THE MATTER OF SECTION 288 OF THE BRITISH COLUMBIA BUSINESS

CORPORATIONS ACT, S.B.C. 2002, C.57, AS AMENDED

AND

IN THE MATTER OF A PROPOSED ARRANGEMENT INVOLVING

VIZSLA SILVER CORP., ITS SHAREHOLDERS AND

VIZSLA ROYALTIES CORP.

VIZSLA SILVER CORP.

PETITIONER

NOTICE OF HEARING FOR FINAL ORDER

To: The common shareholders ("Vizsla Silver Shareholders") of Vizsla Silver Corp. ("Vizsla Silver")

 

NOTICE IS HEREBY GIVEN that a Petition has been filed by the Petitioner, Vizsla Silver, in the Supreme Court of British Columbia (the "Court") for approval of a plan of arrangement (the "Arrangement"), pursuant to the Business Corporations Act, S.B.C., 2002, c. 57, as amended (the "BCBCA");

AND NOTICE IS FURTHER GIVEN that by an Interim Order Made After Application, pronounced by the Court on May 15, 2024, the Court has given directions as to the calling of a special meeting of the Vizsla Silver Shareholders, for the purpose of, among other things, considering, and voting upon the special resolution to approve the Arrangement;

AND NOTICE IS FURTHER GIVEN that an application for a Final Order approving the Arrangement and for a determination that the terms and conditions of the Arrangement are procedurally and substantively fair and reasonable to the Vizsla Silver Shareholders, and will be made before the presiding Judge in Chambers at the Courthouse, 800 Smithe Street, Vancouver, British Columbia on June 19, 2024 at 9:45 am (Vancouver time), or as soon thereafter as counsel may be heard (the "Final Application");

AND NOTICE IS FURTHER GIVEN that the Final Order approving the Arrangement will, if made, serve as the basis of an exemption from the registration requirements of the United States Securities Act of 1933, as amended, pursuant to Section 3(a)(10) thereof with respect to securities issued under the Arrangement.

IF YOU WISH TO BE HEARD, any person affected by the Final Order sought may appear (either in person or by counsel) and make submissions at the hearing of the Final Application if such person has filed with the Court at the Court Registry, 800 Smithe Street, Vancouver, British Columbia, a Response to Petition ("Response") in the form prescribed by the Supreme Court Civil Rules, together with any affidavits and other material on which that person intends to rely at the hearing of the Final Application, and delivered a copy of the Response, together with all affidavits and other material on which such person intends to rely at the hearing of the Final Application, including an outline of such person's proposed submissions, to the Petitioner at its address for delivery set out below by or before 4:00 p.m. (Vancouver time) on June 17, 2024. 


- 2 -

The Petitioner's address for delivery is:

CRABTREE LAW

201-815 Main Street

West Vancouver, BC V7T 2Z3

Attention: Andrew Crabtree /Faraz Ravanbakhsh

IF YOU WISH TO BE NOTIFIED OF ANY ADJOURNMENT OF THE FINAL APPLICATION, YOU MUST GIVE NOTICE OF YOUR INTENTION by filing and delivering the form of "Response" as aforesaid. You may obtain a form of "Response" at the Court Registry, 800 Smithe Street, Vancouver, British Columbia, V6Z 2E1.

AT THE HEARING OF THE FINAL APPLICATION the Court may approve the Arrangement as presented, or may approve it subject to such terms and conditions as the Court deems fit.

A copy of the said Petition and other documents in the proceeding will be furnished to any Vizsla Silver Shareholder or Vizsla Silver security holder upon request in writing addressed to the solicitors of the Petitioner at the address for delivery set out above.

DATED: May 15, 2024

"Faraz Ravanbakhsh"

 

Faraz Ravanbakhsh

 

Lawyer for Petitioner



SCHEDULE "F"

STATUTORY DISSENT PROVISIONS

Division 2 - Dissent Proceedings

Definitions and application

237

(1) In this Division:

"dissenter" means a shareholder who, being entitled to do so, sends written notice of dissent when and as required by section 242;

"notice shares" means, in relation to a notice of dissent, the shares in respect of which dissent is being exercised under the notice of dissent; "payout value" means,

(a) in the case of a dissent in respect of a resolution, the fair value that the notice shares had immediately before the passing of the resolution,

(b) in the case of a dissent in respect of an arrangement approved by a court order made under section 291

(2) (c) that permits dissent, the fair value that the notice shares had immediately before the passing of the resolution adopting the arrangement,

(c) in the case of a dissent in respect of a matter approved or authorized by any other court order that permits dissent, the fair value that the notice shares had at the time specified by the court order, or

(d) in the case of a dissent in respect of a community contribution company, the value of the notice shares set out in the regulations,

excluding any appreciation or depreciation in anticipation of the corporate action approved or authorized by the resolution or court order unless exclusion would be inequitable.

(2) This Division applies to any right of dissent exercisable by a shareholder except to the extent that

(a) the court orders otherwise, or

(b) in the case of a right of dissent authorized by a resolution referred to in section 238 (1) (g), the court orders otherwise or the resolution provides otherwise.

Right to dissent

238 (1) A shareholder of a company, whether or not the shareholder's shares carry the right to vote, is entitled to dissent as follows:

(a) under section 260, in respect of a resolution to alter the articles

(i) to alter restrictions on the powers of the company or on the business the company is permitted to carry on, or

(ii) without limiting subparagraph (i), in the case of a community contribution company, to alter any of the company's community purposes within the meaning of section 51.91;

(b) under section 272, in respect of a resolution to adopt an amalgamation agreement;


(c) under section 287, in respect of a resolution to approve an amalgamation under Division 4 of Part 9;

(d) in respect of a resolution to approve an arrangement, the terms of which arrangement permit dissent;

(e) under section 301 (5), in respect of a resolution to authorize or ratify the sale, lease or other disposition of all or substantially all of the company's undertaking;

(f) under section 309, in respect of a resolution to authorize the continuation of the company into a jurisdiction other than British Columbia;

(g) in respect of any other resolution, if dissent is authorized by the resolution; (h) n respect of any court order that permits dissent.

(2) A shareholder wishing to dissent must

(a) prepare a separate notice of dissent under section 242 for

(i) the shareholder, if the shareholder is dissenting on the shareholder's own behalf, and

(ii) each other person who beneficially owns shares registered in the shareholder's name and on whose behalf the shareholder is dissenting,

(b) identify in each notice of dissent, in accordance with section 242 (4), the person on whose behalf dissent is being exercised in that notice of dissent, and

(c) dissent with respect to all of the shares, registered in the shareholder's name, of which the person identified under paragraph (b) of this subsection is the beneficial owner.

(3) Without limiting subsection (2), a person who wishes to have dissent exercised with respect to shares of which the person is the beneficial owner must

(a) dissent with respect to all of the shares, if any, of which the person is both the registered owner and the beneficial owner, and

(b) cause each shareholder who is a registered owner of any other shares of which the person is the beneficial owner to dissent with respect to all of those shares.

Waiver of right to dissent

239 (1) A shareholder may not waive generally a right to dissent but may, in writing, waive the right to dissent with respect to a particular corporate action.

(2) A shareholder wishing to waive a right of dissent with respect to a particular corporate action must

(a) provide to the company a separate waiver for

(i) the shareholder, if the shareholder is providing a waiver on the shareholder's own behalf, and

(ii) each other person who beneficially owns shares registered in the shareholder's name and on whose behalf the shareholder is providing a waiver, and (b) identify in each waiver the person on whose behalf the waiver is made.

(3) If a shareholder waives a right of dissent with respect to a particular corporate action and indicates in the waiver that the right to dissent is being waived on the shareholder's own behalf, the shareholder's right to dissent with respect to the particular corporate action terminates in respect of the shares of which the shareholder is both the registered owner and the beneficial owner, and this Division ceases to apply to


(a) the shareholder in respect of the shares of which the shareholder is both the registered owner and the beneficial owner, and

(b) any other shareholders, who are registered owners of shares beneficially owned by the first mentioned shareholder, in respect of the shares that are beneficially owned by the first mentioned shareholder.

(4) If a shareholder waives a right of dissent with respect to a particular corporate action and indicates in the waiver that the right to dissent is being waived on behalf of a specified person who beneficially owns shares registered in the name of the shareholder, the right of shareholders who are registered owners of shares beneficially owned by that specified person to dissent on behalf of that specified person with respect to the particular corporate action terminates and this Division ceases to apply to those shareholders in respect of the shares that are beneficially owned by that specified person.

Notice of resolution

240 (1) If a resolution in respect of which a shareholder is entitled to dissent is to be considered at a meeting of shareholders, the company must, at least the prescribed number of days before the date of the proposed meeting, send to each of its shareholders, whether or not their shares carry the right to vote, (a) a copy of the proposed resolution, and

(a) a copy of the proposed resolution, and

(b) a notice of the meeting that specifies the date of the meeting, and contains a statement advising of the right to send a notice of dissent.

(2) If a resolution in respect of which a shareholder is entitled to dissent is to be passed as a consent resolution of shareholders or as a resolution of directors and the earliest date on which that resolution can be passed is specified in the resolution or in the statement referred to in paragraph (b), the company may, at least 21 days before that specified date, send to each of its shareholders, whether or not their shares carry the right to vote,

(a) a copy of the proposed resolution, and

(b) a statement advising of the right to send a notice of dissent.

(3) If a resolution in respect of which a shareholder is entitled to dissent was or is to be passed as a resolution of shareholders without the company complying with subsection (1) or (2), or was or is to be passed as a directors' resolution without the company complying with subsection (2), the company must, before or within 14 days after the passing of the resolution, send to each of its shareholders who has not, on behalf of every person who beneficially owns shares registered in the name of the shareholder, consented to the resolution or voted in favour of the resolution, whether or not their shares carry the right to vote,

(a) a copy of the resolution,

(b) a statement advising of the right to send a notice of dissent, and

(c) if the resolution has passed, notification of that fact and the date on which it was passed.

(4) Nothing in subsection (1), (2) or (3) gives a shareholder a right to vote in a meeting at which, or on a resolution on which, the shareholder would not otherwise be entitled to vote.


Notice of court orders

241 If a court order provides for a right of dissent, the company must, not later than 14 days after the date on which the company receives a copy of the entered order, send to each shareholder who is entitled to exercise that right of dissent

(a) a copy of the entered order, and

(b) a statement advising of the right to send a notice of dissent.

Notice of dissent

242 (1) A shareholder intending to dissent in respect of a resolution referred to in section 238 (1) (a), (b), (c), (d), (e) or (f) must,

(a) if the company has complied with section 240 (1) or (2), send written notice of dissent to the company at least 2 days before the date on which the resolution is to be passed or can be passed, as the case may be,

(b) if the company has complied with section 240 (3), send written notice of dissent to the company not more than 14 days after receiving the records referred to in that section, or

(c) if the company has not complied with section 240 (1), (2) or (3), send written notice of dissent to the company not more than 14 days after the later of

(i) the date on which the shareholder learns that the resolution was passed, and

(ii) the date on which the shareholder learns that the shareholder is entitled to dissent.

(2) A shareholder intending to dissent in respect of a resolution referred to in section 238 (1) (g) must send written notice of dissent to the company

(a) on or before the date specified by the resolution or in the statement referred to in section 240 (2) (b) or

(3) (b) as the last date by which notice of dissent must be sent, or

(b) if the resolution or statement does not specify a date, in accordance with subsection (1) of this section.

(3) A shareholder intending to dissent under section 238 (1) (h) in respect of a court order that permits dissent must send written notice of dissent to the company

(a) within the number of days, specified by the court order, after the shareholder receives the records referred to in section 241, or

(b) if the court order does not specify the number of days referred to in paragraph (a) of this subsection, within 14 days after the shareholder receives the records referred to in section 241.

(4) A notice of dissent sent under this section must set out the number, and the class and series, if applicable, of the notice shares, and must set out whichever of the following is applicable:

(a) if the notice shares constitute all of the shares of which the shareholder is both the registered owner and beneficial owner and the shareholder owns no other shares of the company as beneficial owner, a statement to that effect;

(b) if the notice shares constitute all of the shares of which the shareholder is both the registered owner and beneficial owner but the shareholder owns other shares of the company as beneficial owner, a statement to that effect and


(i) the names of the registered owners of those other shares,

(ii) the number, and the class and series, if applicable, of those other shares that are held by each of those registered owners, and

(iii) a statement that notices of dissent are being, or have been, sent in respect of all of those other shares;

(c) if dissent is being exercised by the shareholder on behalf of a beneficial owner who is not the dissenting shareholder, a statement to that effect and

(i) the name and address of the beneficial owner, and

(ii) a statement that the shareholder is dissenting in relation to all of the shares beneficially owned by the beneficial owner that are registered in the shareholder's name.

(5) The right of a shareholder to dissent on behalf of a beneficial owner of shares, including the shareholder, terminates and this Division ceases to apply to the shareholder in respect of that beneficial owner if subsections (1) to (4) of this section, as those subsections pertain to that beneficial owner, are not complied with.

Notice of intention to proceed

243 (1) A company that receives a notice of dissent under section 242 from a dissenter must,

(a) if the company intends to act on the authority of the resolution or court order in respect of which the notice of dissent was sent, send a notice to the dissenter promptly after the later of

(i) the date on which the company forms the intention to proceed, and

(ii) the date on which the notice of dissent was received, or

(b) if the company has acted on the authority of that resolution or court order, promptly send a notice to the dissenter.

(2) A notice sent under subsection (1) (a) or (b) of this section must

(a) be dated not earlier than the date on which the notice is sent,

(b) state that the company intends to act, or has acted, as the case may be, on the authority of the resolution or court order, and

(c) advise the dissenter of the manner in which dissent is to be completed under section 244.

Completion of dissent

244 (1) A dissenter who receives a notice under section 243 must, if the dissenter wishes to proceed with the dissent, send to the company or its transfer agent for the notice shares, within one month after the date of the notice,

(a) a written statement that the dissenter requires the company to purchase all of the notice shares,

(b) the certificates, if any, representing the notice shares, and

(c) if section 242 (4) (c) applies, a written statement that complies with subsection (2) of this section.

(2) The written statement referred to in subsection (1) (c) must


(a) be signed by the beneficial owner on whose behalf dissent is being exercised, and

(b) set out whether or not the beneficial owner is the beneficial owner of other shares of the company and, if so, set out

(i) the names of the registered owners of those other shares,

(ii) the number, and the class and series, if applicable, of those other shares that are held by each of those registered owners, and

(iii) that dissent is being exercised in respect of all of those other shares.

(3) After the dissenter has complied with subsection (1),

(a) the dissenter is deemed to have sold to the company the notice shares, and

(b) the company is deemed to have purchased those shares, and must comply with section 245, whether or not it is authorized to do so by, and despite any restriction in, its memorandum or articles.

(4) Unless the court orders otherwise, if the dissenter fails to comply with subsection (1) of this section in relation to notice shares, the right of the dissenter to dissent with respect to those notice shares terminates and this Division, other than section 247, ceases to apply to the dissenter with respect to those notice shares.

(5) Unless the court orders otherwise, if a person on whose behalf dissent is being exercised in relation to a particular corporate action fails to ensure that every shareholder who is a registered owner of any of the shares beneficially owned by that person complies with subsection (1) of this section, the right of shareholders who are registered owners of shares beneficially owned by that person to dissent on behalf of that person with respect to that corporate action terminates and this Division, other than section 247, ceases to apply to those shareholders in respect of the shares that are beneficially owned by that person.

(6) A dissenter who has complied with subsection (1) of this section may not vote, or exercise or assert any rights of a shareholder, in respect of the notice shares, other than under this Division.

Payment for notice shares

245 (1) A company and a dissenter who has complied with section 244 (1) may agree on the amount of the payout value of the notice shares and, in that event, the company must

(a) promptly pay that amount to the dissenter, or

(b) if subsection (5) of this section applies, promptly send a notice to the dissenter that the company is unable lawfully to pay dissenters for their shares.

(2) A dissenter who has not entered into an agreement with the company under subsection (1) or the company may apply to the court and the court may

(a) determine the payout value of the notice shares of those dissenters who have not entered into an agreement with the company under subsection (1), or order that the payout value of those notice shares be established by arbitration or by reference to the registrar, or a referee, of the court,

(b) join in the application each dissenter, other than a dissenter who has entered into an agreement with the company under subsection (1), who has complied with section 244 (1), and

(c) make consequential orders and give directions it considers appropriate.


(3) Promptly after a determination of the payout value for notice shares has been made under subsection (2) (a) of this section, the company must

(a) pay to each dissenter who has complied with section 244 (1) in relation to those notice shares, other than a dissenter who has entered into an agreement with the company under subsection (1) of this section, the payout value applicable to that dissenter's notice shares, or

(b) if subsection (5) applies, promptly send a notice to the dissenter that the company is unable lawfully to pay dissenters for their shares.

(4) If a dissenter receives a notice under subsection (1) (b) or (3) (b),

(a) the dissenter may, within 30 days after receipt, withdraw the dissenter's notice of dissent, in which case the company is deemed to consent to the withdrawal and this Division, other than section 247, ceases to apply to the dissenter with respect to the notice shares, or

(b) if the dissenter does not withdraw the notice of dissent in accordance with paragraph (a) of this subsection, the dissenter retains a status as a claimant against the company, to be paid as soon as the company is lawfully able to do so or, in a liquidation, to be ranked subordinate to the rights of creditors of the company but in priority to its shareholders.

(5) A company must not make a payment to a dissenter under this section if there are reasonable grounds for believing that

(a) the company is insolvent, or

(b) the payment would render the company insolvent.

Loss of right to dissent

246 The right of a dissenter to dissent with respect to notice shares terminates and this Division, other than section 247, ceases to apply to the dissenter with respect to those notice shares, if, before payment is made to the dissenter of the full amount of money to which the dissenter is entitled under section 245 in relation to those notice shares, any of the following events occur:

(a) the corporate action approved or authorized, or to be approved or authorized, by the resolution or court order in respect of which the notice of dissent was sent is abandoned;

(b) the resolution in respect of which the notice of dissent was sent does not pass;

(c) the resolution in respect of which the notice of dissent was sent is revoked before the corporate action approved or authorized by that resolution is taken;

(d) the notice of dissent was sent in respect of a resolution adopting an amalgamation agreement and the amalgamation is abandoned or, by the terms of the agreement, will not proceed;

(e) the arrangement in respect of which the notice of dissent was sent is abandoned or by its terms will not proceed;

(f) a court permanently enjoins or sets aside the corporate action approved or authorized by the resolution or court order in respect of which the notice of dissent was sent;

(g) with respect to the notice shares, the dissenter consents to, or votes in favour of, the resolution in respect of which the notice of dissent was sent;


(h) the notice of dissent is withdrawn with the written consent of the company;

(i) the court determines that the dissenter is not entitled to dissent under this Division or that the dissenter is not entitled to dissent with respect to the notice shares under this Division.

Shareholders entitled to return of shares and rights

247 If, under section 244 (4) or (5), 245 (4) (a) or 246, this Division, other than this section, ceases to apply to a dissenter with respect to notice shares,

(a) the company must return to the dissenter each of the applicable share certificates, if any, sent under section 244 (1) (b) or, if those share certificates are unavailable, replacements for those share certificates,

(b) the dissenter regains any ability lost under section 244 (6) to vote, or exercise or assert any rights of a shareholder, in respect of the notice shares, and

(c) the dissenter must return any money that the company paid to the dissenter in respect of the notice shares under, or in purported compliance with, this Division.



SCHEDULE "G"

SPINCO FOLLOWING THE ARRANGEMENT

TABLE OF CONTENTS

FORWARD LOOKING INFORMATION  2
CORPORATE STRUCTURE  3
DESCRIPTION OF THE BUSINESS 3
HISTORY 6
AVAILABLE FUNDS AND PRINCIPAL PURPOSES 7
DIVIDENDS OR DISTRIBUTIONS  8
SUMMARY OF FINANCIAL INFORMATION  8
MANAGEMENT'S DISCUSSION AND ANALYSIS  9
DESCRIPTION OF SHARE CAPITAL  9
CONSOLIDATED CAPITALIZATION  12
OPTIONS TO PURCHASE SECURITIES 13
PRIOR SALES  14
ESCROWED SECURITIES AND SECURITIES SUBJECT TO CONTRACTUAL RESTRICTION ON TRANSFERS  14
PRINCIPAL SHAREHOLDERS  14
DIRECTORS AND EXECUTIVE OFFICERS 15
DIRECTOR AND EXECUTIVE OFFICER COMPENSATION  18
INDEBTEDNESS OF DIRECTORS, OFFICERS AND EMPLOYEES 18
AUDIT COMMITTEE  19
CORPORATE GOVERNANCE  20
RISK FACTORS  23
PROMOTER  32
LEGAL PROCEEDINGS AND REGULATORY ACTIONS  32
INTERESTS OF CERTAIN PERSONS IN MATERIAL TRANSACTIONS  32
AUDITORS, TRANSFER AGENT AND REGISTRAR 32
MATERIAL CONTRACTS  33
EXPERTS 33
FINANCIAL STATEMENTS DISCLOSURE  33


FORWARD LOOKING INFORMATION

This Schedule "G" includes and incorporates statements that are prospective in nature that constitute forward-looking information and/or forward-looking statements within the meaning of applicable securities laws (collectively, "forward-looking statements"). Forward-looking statements include, but are not limited to, statements concerning the completion and proposed terms of, and matters relating to, the Arrangement and the expected timing related thereto; the tax treatment of the Arrangement; the expected operations, financial results and condition of Spinco following the Arrangement; Spinco's future objectives and strategies to achieve those objectives, including the future prospects of Spinco as an independent company; the estimated cash flow, capitalization and adequacy thereof for Spinco following the Arrangement; the expected benefits of the Arrangement to, and resulting treatment of, shareholders of Spinco ("Spinco Shareholders") and holders of options; the anticipated effects of the Arrangement; the future listing of Spinco's securities on a stock exchange; the fair market value of Spinco Shares and Spinco Warrants; the estimated costs of the Arrangement; the satisfaction of the conditions to consummate the Arrangement; completion of financings by Spinco; completion of the Consolidation and timing thereof; as well as other statements with respect to management's beliefs, plans, estimates and intentions, and similar statements concerning anticipated future events, results, circumstances, performance or expectations that are not historical facts. Forward-looking statements generally can be identified by the use of forward-looking terminology such as "outlook", "objective", "may", "will", "expect", "intend", "estimate", "anticipate", "believe", "should", "plans", "continue", or similar expressions suggesting future outcomes or events.

Forward-looking statements reflect management's current beliefs, expectations and assumptions and are based on information currently available to management, management's historical experience, perception of trends and current business conditions, expected future developments and other factors which management considers appropriate. With respect to the forward-looking statements included in or incorporated into this Schedule "G", Spinco has made certain assumptions with respect to, among other things, the anticipated approval of the Arrangement by Shareholders and the Court; the anticipated receipt of any required regulatory approvals and consents; the expectation that each of Vizsla Silver and Spinco will comply with the terms and conditions of the Arrangement Agreement; the expectation that no event, change or other circumstance will occur that could give rise to the termination of the Arrangement Agreement; that no unforeseen changes in the legislative and operating framework for Spinco will occur; that Spinco will meet its future objectives and priorities; that Spinco will have access to adequate capital to fund its future projects and plans; and that Spinco's future projects and plans will proceed as anticipated; as well as assumptions concerning general economic and industry growth rates, commodity prices, currency exchange and interest rates, and competitive intensity.

Readers are cautioned not to place undue reliance on forward-looking statements, as there can be no assurance that the future circumstances, outcomes or results anticipated or implied by such forward-looking statements will occur or that plans, intentions or expectations upon which the forward-looking statements are based will occur. By their nature, forward-looking statements involve known and unknown risks and uncertainties and other factors that could cause actual results to differ materially from those contemplated by such statements. Factors that could cause such differences include, but are not limited to: conditions precedent or approvals required for the Arrangement not being obtained; the potential benefits of the Arrangement not being realized; the potential value for the New Vizsla Silver Shares, the Spinco Shares and the Spinco Warrants after the Arrangement being less than the trading price of Vizsla Silver Shares immediately prior to the Arrangement; there being no current plan to list Spinco Shares or Spinco Warrants on any stock exchange; there being no established market for the Spinco Shares or Spinco Warrants; neither Spinco Shares nor Spinco Warrants may be "Qualified Investments" as defined in Canadian federal income tax law; the potential inability or unwillingness of current Shareholders to hold New Vizsla Silver Shares, Spinco Shares and/or Spinco Warrants following the Arrangement; Vizsla Silver's ability to delay or amend the implementation of all or part of the Arrangement or to proceed with the Arrangement even if certain consents and approvals are not obtained on a timely basis; future factors that may arise making it inadvisable to proceed with, or advisable to delay, all or part of the Arrangement; the reduced diversity of Vizsla Silver and Spinco as separate companies; the costs related to the Arrangement that must be paid even if the Arrangement is not completed; general business and economic uncertainties and adverse market conditions; risks related to Spinco's status as an independent reporting issuer following the Arrangement; and risks related to the achievement of Spinco's business objectives.

For a further description of these and other factors that could cause actual results to differ materially from the forward- looking statements included in or incorporated into this Schedule "G", see the risk factors discussed under the heading "Risk Factors" in this Schedule "G", in the Circular and in Schedule "L", as well as the risk factors included in Vizsla Silver's management's discussion and analysis for the year ended April 30, 2023 and as described from time to time in the reports and disclosure documents filed by Vizsla Silver with the Canadian securities regulatory agencies and commissions. This list is not exhaustive of the factors that may impact Spinco's forward-looking statements. These and other factors should be considered carefully and readers should not place undue reliance on Spinco's forward- looking statements. As a result of the foregoing and other factors, there can be no assurance that actual results will be consistent with these forward-looking statements.


All forward-looking statements included in and incorporated into this Schedule "G" are qualified by these cautionary statements. The forward-looking statements contained herein are made as of the date of the Circular and except as required by applicable law, Vizsla Silver and Spinco undertake no obligation to publicly update or revise any forward- looking statement, whether as a result of new information, future events or otherwise.

Readers are cautioned that the actual results achieved will vary from the information provided herein and that such variations may be material. Consequently, there are no representations by Vizsla Silver or Spinco that actual results achieved will be the same in whole or in part as those set out in the forward-looking statements. Reference should also be made to the section entitled "Forward-Looking Information" in the Circular.

All capitalized terms not defined herein have the same meanings ascribed to them in the Circular.

CORPORATE STRUCTURE

Spinco is incorporated under the BCBCA. The Company's head office is located at Suite 1723, 595 Burrard Street, Vancouver, British Columbia V7X 1J1, and its registered office is located at Suite 401, 353 Water Street, Vancouver, British Columbia, V6B 1B8.

Spinco is currently a wholly-owned subsidiary of Vizsla Silver. Following the Arrangement and distribution of the New Vizsla Shares, Spinco Shares and Spinco Warrants, Spinco will no longer be a wholly-owned subsidiary of Vizsla Silver. Following the Arrangement, Shareholders of Vizsla Silver are expected to hold approximately 45% of the issued and outstanding Spinco Shares, while Vizsla Silver will retain the remaining approximately 55%. Vizsla Silver is not expected to retain any Spinco Warrants. The overall ownership structure is expected to change upon completion of the Post-Closing Steps and the exercise of any Spinco Warrants.

INTERCORPORATE RELATIONSHIPS

Following the completion of the Arrangement, Spinco will have one wholly-owned subsidiary: the Spinco Canadian Subsidiary, which was incorporated pursuant to the Business Corporations Act (British Columbia). The Spinco Canadian Subsidiary has one wholly-owned subsidiary in Mexico: the Spinco Mexican Subsidiary.

DESCRIPTION OF THE BUSINESS

OVERVIEW

Spinco is a newly incorporated wholly-owned subsidiary of Vizsla Silver. Upon completion of the Arrangement, Spinco will be a royalty company focused on gaining exposure to commodity prices by making strategic investments in mining interests, including royalties, streams debt and equity investments in mining companies. Spinco intends to execute on its strategy by leveraging the deep industry knowledge and expertise of its board and evaluate investment opportunities in the mining industry.

With respect to royalties, streams and similar interests, the Spinco intends to accumulate and manage a portfolio of diversified mining interest that may be acquired directly from mine operators, as well as third party holders of existing royalties, across the spectrum of project stages, from grassroots to production. In evaluating such transactions, Spinco utilizes a disciplined approach to manage its fiscal profile.


Prior to the completion of the Arrangement, Spinco is not a reporting issuer and neither the Spinco Shares nor the Spinco Warrants are listed on any stock exchange. Upon completion of the Arrangement, Spinco expects that it will be a reporting issuer in each of the provinces and territories in Canada. While Spinco has made an application with the TSXV to list the Spinco Shares and Spinco Warrants, there is no guarantee when, or if, such listings will be completed. Such listings will be subject to Spinco fulfilling all of the listing requirements of the TSXV. Until the Spinco Shares and Spinco Warrants are listed on a stock exchange, Spinco Shareholders and Spinco Warrantholders may not be able to sell their Spinco Shares or Spinco Warrants. No assurance can be given as to if, or when, the Spinco Shares or Spinco Warrants will be listed or traded on any such stock exchange, including whether such listing will be completed on or before the date for Spinco's first income tax return.

SPINCO'S STRATEGY

Spinco's strategy is to focus on creating value for stakeholders through the purchase of additional royalties and streams from third parties and investing in resource-focused companies. At present, Spinco is a royalty-focused company with initial assets comprised of the Royalty, the Royalty Buyback Right and the Future Royalty Right. As Spinco executes on its business plan it intends to seek to purchase additional royalties and streams from third parties and make additional investments in resource-focused companies. Spinco intends to execute on its strategy by leveraging the deep industry knowledge and expertise of its board and evaluate investment opportunities in the mining industry.

With respect to royalties, streams and similar interests, Spinco intends to accumulate and manage a portfolio of diversified mining interests that may be acquired directly from mine operators, as well as third party holders of existing royalties, across the spectrum of project stages, from grassroots exploration to production. In evaluating such transactions, Spinco utilizes a disciplined approach to manage its fiscal profile.

Additionally, Spinco may consider opportunities to restructure its royalties or streams where it believes such a restructuring may provide a long-term benefit to Spinco Shareholders, even if such restructuring may reduce near- term revenues or result in Spinco incurring transaction related costs. Spinco may enter into one or more acquisitions, restructurings or other Royalty and Streaming transactions at any time.

ROYALTY

Pursuant to the Royalty Agreements, the Other Concessions are currently subject to a 2% net smelter returns royalty in favour of the Spinco Mexican Subsidiary and the Silverstone Concessions are currently subject to a 0.5% net smelter returns royalty in favour of the Spinco Mexican Subsidiary (collectively, the "Royalty").

The Silverstone Concessions are also subject to a 3% net smelter returns royalty (the "Underlying Royalty"). The Spinco Mexican Subsidiary has the right to buyback one-half of the Underlying Royalty for consideration of US$1,950,000 (the "Royalty Buyback Right").

Following exercise of the Royalty Buyback Right, the Royalty will consist of a 2% net smelter returns royalty on the entire Panuco Project (the Silverstone Concessions and the Other Concessions).

FUTURE ROYALTY RIGHT

The Royalty Right Agreement provides that, if Vizsla Silver or any of its affiliates acquires any a mineral property within a two-kilometer boundary around the Panuco Project, it must give notice to Spinco and offer to grant a net smelter returns royalty on such mineral property to Spinco on terms proposed by Vizsla Silver (the "Future Royalty Right"). Spinco may then elect to accept the terms of such offer.

The Royalty Right Agreement will terminate upon the earlier of (a) the date which is 24 months from the Effective Date, and (b) a change of control of Vizsla Silver or Spinco.

The foregoing discussion of the Royalty Right Agreement is intended to provide a general review and summary only. For details, reference should be made to the Royalty Right Agreement. Shareholders are encouraged to read the Royalty Right Agreement in its entirety. Upon request, Vizsla Silver will promptly provide a copy of the Royalty Right Agreement free of charge to a securityholder of Vizsla Silver.

FIRST LOAN

Vizsla Silver loaned $1,609,312 (the "First Loan") to Spinco prior to the date of this Circular. The proceeds of the First Loan were utilized by Spinco to fund start-up costs including those relating to the Arrangement, and for general business requirements. The First Loan is unsecured, non-interest bearing and due upon completion of the Arrangement in cash or Spinco Shares at the discretion of Spinco.


POST-CLOSING STEPS

Following closing of the Arrangement but prior to the Listing Date, Vizsla Silver and Spinco intend to complete the following steps (the "Post-Closing Steps"):

FIRST LOAN SETTLEMENT

The parties intend to settle the principal amount of the First Loan for an aggregate of 32,186,240 Spinco Shares at a deemed price of $0.05 per pre-Consolidation Spinco Share ($0.50 per post-Consolidation Spinco Share) (the "First Loan Settlement"). Following the First Loan Settlement, Vizsla Silver is expected to hold approximately 62% of the issued and outstanding Spinco Shares.

SECOND LOAN

Vizsla Silver intends to lend an additional $3,500,000 (the "Second Loan") to Spinco. The proceeds of the Second Loan are expected to be utilized by Spinco to exercise the Royalty Buyback Right and pay related transaction fees. The Second Loan is expected to be unsecured, bear interest at 5% per annum and is due in July, 2028. The Second Loan may be repaid by Spinco anytime prior to the maturity date without penalty. The Second Loan will be outstanding on the Listing Date.

ROYALTY BUYBACK RIGHT

As part of the Post-Closing Steps, Spinco intends to exercise the Royalty Buyback Right.

SPINCO FINANCING

Spinco intends to complete a private placement at least 50,000,000 pre-Consolidation Spinco Shares (5,000,000 post- Consolidation Spinco Shares) at a price of $0.06 per pre-Consolidation Spinco Share ($0.60 per post-Consolidation Spinco Share) for aggregate gross proceeds of at least $3,000,000, or on such other terms acceptable to Spinco in order to allow Spinco to satisfy the initial listing requirements of the TSXV (the "Spinco Financing"). Completion of the Spinco Financing is not a condition to completion of the Arrangement.

CONSOLIDATION

As part of the Post-Closing Steps, Spinco intends to complete a consolidation of the Spinco Shares on the basis of one new Spinco Share for every ten old Spinco Shares. Completion of the Consolidation is not a condition to completion of the Arrangement.

PRINCIPAL MARKETS

As described more fully under "Description of the Business - Overview" above, Spinco is a royalty company initially focused on the Royalty. As Spinco executes on its business plan, it intends to seek to purchase additional royalties and streams from third parties and make additional investments in resource-focused companies.

SPECIALIZED SKILLS AND KNOWLEDGE

Many aspects of Spinco's business require specialized skill and knowledge. Such skills and knowledge include the areas of finance, geology, drilling, logistical planning and implementation of exploration programs, accounting and natural resources. Spinco retains executive officers and consultants with experience in finance, mining, metallurgy, geology, exploration and development in Canada, and the United States generally, as well as executive officers and consultants with relevant accounting experience. See "Directors and Executive Officers" for details as to the specific skills and knowledge of Spinco's directors and management.


COMPETITIVE CONDITIONS

Companies operating in the mining industry must manage risks, which are beyond the direct control of company personnel. Among these risks are those associated with exploration, environmental damage, commodity prices, foreign exchange rates and interest rates.

The business of Spinco is highly competitive in all phases, with many companies engaged in the acquisition of royalties, streams and similar interest. As a result of this competition, there can be no assurance that Spinco will be able to compete successfully against other companies in acquiring additional royalties, streams or similar interest. Spinco also competes with other mining companies for investment capital with which to fund such investments and for the recruitment and retention of qualified employees. See "Risk Factors".

BUSINESS CYCLES

Spinco's business is not cyclical and can be conducted year-round.

ECONOMIC DEPENDENCE

Spinco will be dependent to a large extent on the financial viability of the properties underlying the royalties, streams and similar interest that are or may be held by Spinco. On February 22, 2022 and February 25, 2022, the Vizsla Silver Mexican Subsidiary entered into the Royalty Agreements with the Spinco Mexican Subsidiary.

Under the terms of the Royalty Agreements, the Vizsla Silver Mexican Subsidiary may pay the Royalty to the Spinco Mexican Subsidiary.

ENVIRONMENTAL PROTECTION

All phases of the properties underlying the royalties, streams or similar interests that are or may be held by Spinco are subject to environmental regulation in the jurisdictions in which they operate. These regulations mandate, among other things, the maintenance of air and water quality standards and land reclamation. They also set out limitations on the generation, transportation, storage and disposal of solid and hazardous waste. Environmental legislation is evolving in a manner which will likely, in the future, require stricter standards and enforcement, increased fines and penalties for non-compliance, more stringent environmental assessments of proposed projects and heightened degree of responsibility for companies and their officers, directors and employees.

EMPLOYEES

On the Effective Date, Spinco does not expect to have any employees. Spinco expects to have three consultants.

FOREIGN OPERATIONS

Spinco will be dependent to a large extent on the viability of the properties underlying the royalties, streams and similar interest that are or may be held by Spinco. Currently, Spinco's business is dependent on the success of the Panuco Project. The Panuco Project is located in Sinaloa, Mexico. As such, Spinco's operations may be affected by local political and economic developments, including expropriation, invalidation of government orders, permits or agreements pertaining to property rights, political unrest, labour disputes, limitations on repatriation of earnings, limitations on mineral exports, limitations on foreign ownership, inability to obtain or delays in obtaining necessary mining permits, opposition to mining from local, environmental or other non-governmental organizations, government participation, royalties, duties, rates of exchange, high rates of inflation, price controls, exchange controls, currency fluctuations, taxation and changes in laws, regulations or policies as well as by laws and policies of Canada affecting foreign trade, investment and taxation.

HISTORY

On October 13, 2023, Vizsla Silver incorporated Spinco as a wholly-owned subsidiary.


 On February 22, 2022 and February 25, 2022, the Vizsla Silver Mexican Subsidiary and the Spinco Mexican Subsidiary entered into the Royalty Agreements.

On March 27, 2024 Spinco entered into the Arrangement Agreement between Spinco and Vizsla Silver, whereby Vizsla Silver will be reorganized into two companies by way of the Plan of Arrangement under the BCBCA.

On May 8, 2024, Spinco entered into the Royalty Right Agreement with Vizsla Silver.

AVAILABLE FUNDS AND PRINCIPAL PURPOSES

AVAILABLE FUNDS

The following table shows the foreseeable available funds to the Spinco, based on currently available information:

Item

Funds

Working capital of Spinco upon completion of the Arrangement

($1,400,000)

Net proceeds of the subscription by Vizsla Silver for Spinco Warrants(1)

$80,000

Net proceeds of the Second Loan

$3,500,000

Net proceeds of the Spinco Financing(2)

$2,700,000

Total

$4,880,000

Notes:

(1) Prior to completion of the Arrangement, Vizsla Silver will subscribe for a number of Spinco Warrants equal to the Number of Spinout Warrants for the purposes of distributing such Spinco Warrants to Shareholders. Assuming, for illustrative purposes, that the Number of Spinout Warrants will be 80,000,000.

(2) Assuming gross proceeds of the Spinco Financing are $3,000,000. Spinco expects to pay up to 10% in fees and commissions in respect of the Spinco Financing.

PRINCIPAL PURPOSES

The following table summarizes the expenditures anticipated by Spinco required to achieve its business objectives during the 12 months following completion of the Arrangement:

Item

Purpose

Exercise of the Royalty Buyback Right

$2,700,000

Evaluation and acquisition of potential royalty interests(1)

$450,000

Estimated general and administrative costs for 12 months(2)

$822,000

Unallocated working capital

$908,000

Total

$4,880,000

Notes:

(1) Spinco will augment its royalty portfolio with selective royalty acquisition. Spinco principals and advisors will leverage their geological expertise to identify and evaluate emerging opportunities.

(2) General and administrative costs are estimated as follows: management and director fees $410,000, professional fees $298,000, office and administrative $114,000.


Spinco intends to spend the funds available to it as stated in the table above and intends to arrange for future financing(s) when additional funds are required. However, there may be circumstances where, for sound business reasons, a reallocation of funds may be necessary for Spinco to achieve its objectives or to pursue other opportunities that management believes are in the interests of Spinco. See "Risk Factors - Risks Relating to Spinco's Business" in this Schedule "G".

Additional information regarding the expenses incurred by Spinco since incorporation can be found in the consolidated financial statements of Spinco attached as Schedule "I" to this Circular.

BUSINESS OBJECTIVES AND MILESTONES

At present, Spinco is a royalty company focused on gaining exposure to commodity prices by making strategic investments in mining interests, including royalties, streams debt and equity investments in mining companies. Spinco's goal is to increase shareholder value by accumulating a diverse portfolio of precious and base metal royalties as well as making equity investments with attractive returns.

With the funds available to it as described above under the heading "Available Funds", Spinco intends to manage its current portfolio; evaluate additional potential royalty, stream or equity investment; and acquire interests in additional mineral assets at various stages of development.

DIVIDENDS OR DISTRIBUTIONS

Spinco has not paid any dividends since its incorporation and does not currently have a policy with respect to the payment of dividends. For the immediate future Spinco does not envisage any earnings arising from which dividends could be paid. The payment of dividends in the future will depend on the earnings, if any, and Spinco's financial condition and such other factors as the Spinco Board considers appropriate. See "Risk Factors - Risks Relating to Spinco's Business" in this Schedule "G".

SUMMARY OF FINANCIAL INFORMATION

FINANCIAL STATEMENTS

CAUTIONARY NOTE

The summary financial information has been prepared for illustrative purposes only and may not be indicative of the operating results or financial condition that would have been achieved if the Arrangement had been completed on the date or for the periods noted above, nor do they purport to project the results of operations or financial position for any future period or as of any future date.

FINANCIAL STATEMENTS FOR SPINCO

Included as Schedule "I" to this Circular are the consolidated financial statements of Spinco consisting of: (A) a statement of comprehensive income, a statement of changes in equity and a statement of cash flows; (B) a statement of financial position as at the end of the financial period; and (C) the notes thereto, for the nine months ended January 31, 2024 and 2023, as well as the year ended April 30, 2023 and 2022.

Included as Schedule "J" to this Circular are the pro forma financial statements of Royalty Corp consisting of: (A) pro forma statement of financial position as at the date of Spinco's most recent statement of financial position, that gives effect to the Arrangement as if it had taken place on such date; (B) Spinco's pro forma income statement, that gives effect to the Arrangement as if it had taken place at the beginning of its financial year; and (C) Spinco's pro forma earnings per share based on the pro forma financial statements.


MANAGEMENT'S DISCUSSION AND ANALYSIS

Spinco's MD&A for the nine months ended January 31, 2024 and 2023, as well as the year ended April 30, 2023 and 2022 are attached as Schedule "I" to this Circular. The attached MD&A should be read in conjunction with the consolidated financial statements of Spinco consisting of: (A) a statement of comprehensive income, a statement of changes in equity and a statement of cash flows; (B) a statement of financial position as at the end of the financial period; and (C) the notes thereto, for the nine months ended January 31, 2024 and 2023, as well as the year ended April 30, 2023 and 2022, attached as Schedules "I", to this Circular.

DESCRIPTION OF SHARE CAPITAL

AUTHORIZED CAPITAL

Spinco is authorized to issue an unlimited number of common shares with no par value. As at the date of this Circular, one Spinco Share was issued and outstanding. The sole Spinco Share issued and outstanding is held by Vizsla Silver. Prior to the Effective Date, Spinco is expected to complete a share split such that the outstanding number of Spinco Shares after such split will be equal to such number of shares required to allow Vizsla Silver to distribute 1/3 of a Spinco Share for each Vizsla Share held by Shareholders, with Vizsla Silver retaining certain Spinco Shares.

SPINCO SHARES

Spinco Shareholders are entitled to receive notice of and to attend and vote at all meetings of the Spinco Shareholders and each of the Spinco Shares confers the right to one vote in person or by proxy at all meeting of Spinco Shareholders. Spinco Shareholders are entitled to receive such dividends in any financial year as the Spinco Board and Spinco Shareholders may by resolution determine. The capital and assets of Spinco on a winding-up or other return of capital will be applied in repaying to Spinco Shareholders the amounts paid up or credited as paid up on their Spinco Shares and subject thereto will belong to and be distributed accordingly to the number of such Spinco Shares held by them respectively. The Spinco Shares do not carry any pre-emptive, subscription, redemption or conversion rights, nor do they contain any sinking or purchase fund provisions. When fully paid, the Spinco Shares will not be liable to further call or assessment.

As of the date of this Circular, there is one Spinco Share outstanding. Prior to completion of the Arrangement, Spinco will subdivide the one issued and outstanding Spinco Share into a number of Spinco Shares equal to the Number of Spinout Shares plus the Number of Retained Shares.

SPINCO WARRANTS

As of the date of this Circular, there are no Spinco Warrants outstanding. Prior to completion of the Arrangement, Vizsla Silver will subscribe for a number of Spinco Warrants equal to the Number of Spinout Warrants for the purposes of distributing such Spinco Warrants to Shareholders.

SPINCO OPTIONS

As of the date of this Circular, there are no Spinco Options outstanding. Pursuant to the Plan of Arrangement, each Vizsla Silver Option then outstanding to acquire one Vizsla Silver Share will be transferred and exchanged for:

1. one Vizsla Silver Replacement Option to acquire one New Vizsla Silver Share having an exercise price equal to the product of the original exercise price of the Vizsla Silver Option multiplied by the fair market value of a New Vizsla Silver Share at the Effective Time divided by the total of the fair market value of a New Vizsla Silver Share and the fair market value of 1/3 of a Spinco Share at the Effective Time; and

2. one Spinco Option to acquire 1/3 of a Spinco Share, each whole Spinco Option having an exercise price equal to the product of the original exercise price of the Vizsla Silver Option multiplied by the fair market value of 1/3 of a Spinco Share at the Effective Time divided by the total of the fair market value of one New Vizsla Silver Share and 1/3 of a Spinco Share at the Effective Time,


provided that the aforesaid exercise prices will be adjusted to the extent, if any, required to ensure that the aggregate In the Money Amount of the Vizsla Silver Replacement Option and the Spinco Option immediately after the exchange does not exceed the In the Money Amount immediately before the exchange of the Vizsla Silver Option so exchanged. The Board will define the fair market value of the Spinco Shares, acting in good faith, prior to the Effective Date. The Board's determination of fair market value will be calculated by taking into account the assets and liabilities of Spinco. The valuation of the Royalty will be based on the midpoint of the valuations of comparable royalty transactions. The Board has received a valuation to support its determination of fair market value.

Accordingly, upon completion of the Arrangement, Spinco expects that Spinco Options to purchase an aggregate of 6,267,907 Spinco Shares will be outstanding. Spinco may issue additional Spinco Options prior to the Listing Date.

The Spinco Board will adopt the Spinco Option Plan. Shareholders are being asked to consider and, if thought advisable, to pass, with or without amendment, an ordinary resolution to approve the Spinco Option Plan. The purpose of the Spinco Option Plan is to attract, retain and motivate Spinco Service Providers to align the interests of such persons with those of shareholders of Spinco through the incentive inherent in share ownership and by providing them an opportunity to participate in Spinco's future performance through awards of options and bonus shares. Spinco believes the Spinco Option Plan will increase its ability to attract skilled individuals by providing them with the opportunity, through the exercise of stock options to benefit from the anticipated growth of Spinco. The Spinco Board has the authority to determine the directors, officers, employees and consultants to whom options will be granted, the number of options to be granted to each person and the price at which Spinco Shares may be purchased, subject to the terms and conditions set forth in the Spinco Option Plan.

SPINCO OPTION PLAN

The following is a summary of certain material terms of the Spinco Option Plan and is qualified in its entirety by the full text of the Spinco Option Plan, a copy of which is attached as Schedule "I" in this Circular. All Spinco Options granted pursuant to the Plan of Arrangement will be governed by the terms set forth in the Spinco Option Plan.

The Spinco Option Plan is administered by the Spinco Board. The Spinco Option Plan is a 10% "rolling plan". Spinco Options granted under the Spinco Option Plan are not exercisable for a period longer than ten years and the exercise price must be paid in full upon exercise of each Vizsla Silver Option.

The following is a summary of the material terms of the Spinco Option Plan:

(a) a Spinco Option granted under the Spinco Option Plan will have an expiry date not to exceed ten years from the date of grant;

(b) any Spinco Option granted that expires or terminates for any reason without having been exercised will again be available under the Spinco Option Plan;

(c) the maximum number of Spinco Options which may be granted to any one holder under the Spinco Option Plan within any 12 month period will be 5% of the outstanding shares, unless Spinco obtains disinterested shareholder approval;

(d) the maximum number of Spinco Options which may be granted to insiders within any 12 month period must not exceed 10% of the outstanding shares (including any Spinco Options which are granted and exercised within that 12 month period), unless Spinco obtains disinterested shareholder approval;

(e) Spinco Options will vest as required by the TSXV and as may be determined by the administrator of the Spinco Option Plan, or in the absence of such body, the Spinco Board;

(f) the minimum exercise price of any Spinco Option issued under the Spinco Option Plan may not be less than the closing trading price of Spinco's shares on the day immediately preceding the grant date, subject to any discount allowed by the policies of the TSXV;


(g) for stock options held by executives who cease to hold such position other than by reason of death or disability, the expiry date will be the 30th day following the date the holder ceases to hold such position, unless otherwise determined by the Spinco Board and in any event such date not to exceed one year. If the holder ceases to hold such position as a result of (i) ceasing to meet the corporate law qualifications of the position previously held, (ii) having been removed by such position by a special resolution of shareholders, or (iii) a regulatory authority order, the stock option held by such executive will expire on the date such holder ceases to hold such position;

(h) Spinco cannot grant Spinco Options to any one consultant in any 12 month period which could, when exercised, result in the issuance of shares exceeding 2% of the issued and outstanding common shares of Spinco;

(i) Spinco cannot grant Spinco Option in any 12 month period to persons employed or engaged by Spinco to perform investor relations activities which could, when exercised, result in the issuance of common shares exceeding, in aggregate, 2% of the issued and outstanding shares of Spinco and stock options issued to consultants performing investor relations activities must vest in stages over 12 months with no more than 1/4 of the stock options vested in any three month period;

(j) in connection with the exercise of a Spinco Option, as a condition to such exercise Spinco may require the optionee to pay to Spinco an amount as necessary so as to ensure that Spinco is in compliance with the applicable provisions of any federal, provincial or local laws relating to the withholding of tax or other required deductions relating to the exercise of such stock option; and

(k) subject to the approval of the TSXV, in the case of a change of control the Spinco Board may, without the consent of option holders cause all or a portion of any of stock options to terminate or be exchanged for stock options of another corporation upon the occurrence of a change of control in such ratio and at such exercise price as the Spinco Board deems appropriate, acting reasonably; and

(l) in lieu of exercising a Royalties Option to receive common shares, the Spinco Board may permit participants to elect to undertake a "cashless exercise" or a "net exercise" in respect of Royalties Options.

As of the date of this Circular, Spinco has no Spinco Options outstanding under the Spinco Option Plan. Assuming no Vizsla Silver Options are exercised between the date of this Circular and the Effective Date, it is expected that 6,267,907 Spinco Options will be outstanding under the Spinco Option Plan, pursuant to the Arrangement. Spinco may issue additional Spinco Options prior to the Listing Date.

The Spinco Option Plan is a rolling stock option plan which sets the number of Spinco Options available for grant at an amount equal to 10% of Spinco's issued and outstanding common shares from time to time.

In connection with the Arrangement, Shareholders are being asked to consider, and if thought fit, pass the Spinco Option Plan Resolution to approve the Spinco Option Plan.

VIZSLA SILVER RIGHTS PLAN

Following the Effective Time, the Vizsla Silver Rights Plan will not apply to Spinco or to the Spinco Shares. Spinco currently has no plans to adopt a shareholder rights plan following the Arrangement.

NO STOCK EXCHANGE LISTING

While Spinco has made an application with the TSXV to list the Spinco Shares and Spinco Warrants, there is no guarantee when, or if, such listings will be completed. Such listings will be subject to Spinco fulfilling all of the listing requirements of the TSXV.

As at the date of the Circular, there is no market through which the Spinco Shares or Spinco Warrants to be distributed pursuant to the Arrangement may be sold and Shareholders may not be able to resell the Spinco Shares or Spinco Warrants to be distributed to them pursuant to the Arrangement. This may affect the pricing of the Spinco Shares and Spinco Warrants in the secondary market and the liquidity of the Spinco Shares and Spinco Warrants. See "Risk Factors".


CONSOLIDATED CAPITALIZATION

The following table sets forth Spinco's capitalization as at the date of this Circular. The following table should be read in conjunction with the financial statements of Spinco, including the notes thereto, contained elsewhere in this Circular.

Capital Authorized Amount
Outstanding On
Incorporation
Amount
Outstanding as at
Date of Circular
Amount Expected
to be Outstanding
on Completion of
Arrangement
Spinco Shares Unlimited 1 1 180,000,000(1)
Spinco Warrants N/A Nil Nil 80,000,000(2)
Spinco Options N/A Nil Nil(2) 6,267,907
Short Term Debt N/A Nil $1,609,312 $1,609,312(3)

Notes:

(1) Assuming, for illustrative purposes, that the Number of Spinout Shares will be 80,000,000 and the Number of Retained Shares will be 100,000,000.

(2) Assuming, for illustrative purposes, that the Number of Spinout Warrants will be 80,000,000.

(3) The First Loan Amount is expected to be settled into Spinco Shares pursuant to the Post-Closing Steps. See "Schedule G - Spinco Following the Arrangement - Loans".

Prior to taking into account the Consolidation, the pro forma fully-diluted share capital of Spinco, upon completion of the Arrangement and the exercise of all options and warrants to acquire Spinco Shares (but not taking into account the Spinco Shares issuable pursuant to the Post-Closing Steps or the exercise of Spinco Warrants) is set out below:

Designation of Spinco Security Number of Spinco Shares Percentage
 
Spinco Shares retained by Vizsla Silver 100,000,000(1) 36.84%
Spinco Shares issued to Shareholders in accordance with the Arrangement 80,000,000(2) 29.48%
Spinco Shares issuable pursuant to the exercise of Spinco Options 6,267,907(5) 2.31%
Spinco Shares issuable pursuant to the exercise of Spinco Warrants 80,000,000(3) 29.48%


Designation of Spinco Security Number of Spinco Shares Percentage
 
     
Spinco Shares issuable pursuant to the exercise ofVizsla Silver Warrants 5,145,721(4) 1.90% 
Total 271,413,628 100%

Notes:

(1) Assuming, for illustrative purposes, that the Number of Retained Shares will be 100,000,000.

(2) Assuming, for illustrative purposes, that the Number of Spinout Shares will be 80,000,000.

(3) Assuming, for illustrative purposes, that the Number of Spinout Warrants will be 80,000,000.

(4) Based on 15,437,163 Vizsla Silver Warrants outstanding as at the date of this Circular.

(5) Based on 18,803,722 Vizsla Silver Options outstanding as at the date of this Circular.

OPTIONS TO PURCHASE SECURITIES

For a description of the Spinco options, see "Spinco Options" and "Spinco Option Plan" above.

The following table sets out information regarding the outstanding Spinco Options that will be exercisable for Spinco Shares pursuant to the Arrangement.

Position of Optionee Spinco Shares
under Option
Exercise
Price(1)
Market Value of
Spinco Shares
underlying the Spinco
Option at the Date of
Grant(2)
Expiration
Date
Executive officers and past executive officers of Spinco as a group (4 individuals) 1,979,241 N/A N/A Between
December 30,
2024 and May
19, 2028
Directors and past directors of Spinco who are not also executive officers, as a group (3 individuals) 461,667 N/A N/A Between June
12, 2024 and
February 26,
2029
All other employees and past employees of Spinco as a group Nil N/A N/A N/A
All consultants of Spinco as a group 3,827,000 N/A N/A Between June
12, 2024 and
February 26,
2029
Total: 6,267,907 N/A N/A Between June
12, 2024 and
February 26,
2029


Notes:

(1) The exercise price will not be determined until the Effective Date.

(2) As the Spinco Shares are not listed on any stock exchange, the market value of the Spinco Shares underlying the Spinco Options on the date of grant is not readily available.

PRIOR SALES

As of the date of this Circular, Spinco has not issued any Spinco Shares other than the one Spinco Share held by Vizsla Silver. Prior to the Effective Date, Spinco is expected to complete a share split such that the outstanding number of Spinco Shares after such split will be equal to such number of shares required to allow Vizsla Silver to distribute 1/3 of a Spinco Share for each Vizsla Share held by Shareholders, with Vizsla Silver retaining certain Spinco Shares.

Spinco Financing

In order to obtain a listing of the Spinco Shares and Spinco Warrants on the TSXV, Spinco must have sufficient cash resources to complete its business objectives, as well as for working capital. Spinco intends to complete the Spinco Financing for gross proceeds of at least $3,000,000, or such other amount as the Spinco Board may determine, on terms acceptable to Spinco in order to allow Spinco to satisfy the initial listing requirements of the TSXV.

ESCROWED SECURITIES AND SECURITIES SUBJECT TO

CONTRACTUAL RESTRICTION ON TRANSFERS

To the knowledge of Spinco, as of the date of the Circular no securities of any class of securities of Spinco are held in escrow or subject to contractual restrictions on transfer or are anticipated to be held in escrow or subject to contractual restrictions on transfer following the completion of the Arrangement.

In connection with the proposed listing of the Spinco Shares and Spinco warrants on the TSXV, the TSXV may require that any securities held by certain shareholders of Spinco, such as the proposed directors, officers and other Insiders (as such term is defined in the policies of the TSXV) be subject to escrow.

PRINCIPAL SHAREHOLDERS

To the knowledge of management of Vizsla Silver and Spinco, no person, firm or company will beneficially own, control or direct, directly or indirectly, voting securities carrying more than 10% of the voting rights attached to any class of voting securities of Spinco immediately following the Effective Time other than Vizsla Silver, which is expected to hold approximately 55% of the issued and outstanding Spinco Shares (prior to completion of the Post- Closing Steps and the exercise of any Spinco Warrants).


DIRECTORS AND EXECUTIVE OFFICERS

The names, municipality of residence and positions with Spinco of the individuals who will serve as the directors and executive officers of Spinco after giving effect to the Arrangement are set out below.

Name, Age, Position(4) and
Municipality of Residence
Principal Occupation and
Experience During Last Five
Years
Date
Appointed(1)
Number of Securities
Beneficially Owned, or
Controlled or
Directed, Directly or
Indirectly(2)
Mike Pettingell

Chief Executive Officer

Age: 41

British Columbia, Canada
Senior Vice-President, Business Development and Strategy of Vizsla Silver Corp. April 25, 2024 20,649 Spinco Shares
335,000 Spinco Options
Grant Tanaka

Chief Financial Officer

Age: 47

British Columbia, Canada
Chief Financial Officer of Vizsla Copper Corp. April 25, 2024 2,167 Spinco Shares
8,333 Spinco Options
Jen Hanson

Corporate Secretary

Age: 49

British Columbia, Canada
President, JC Hanson Corporate Services Inc. (corporate services firm), through which she acts as Corporate Secretary for Vizsla Silver, Outback Goldfields, Tarachi Gold Corp., Vizsla Copper Corp., Targa Exploration Corp. and other public and private companies. April 25, 2024 27,343 Spinco Shares
111,574 Spinco Options
Michael Konnert

Director and Executive

Chairman

Age: 36

British Columbia, Canada
Chief Executive Officer of Vizsla Silver Corp. and Managing Partner of Inventa Capital Corp. April 25, 2024 800,917 Spinco Shares
1,524,333 Spinco
Options



Name, Age, Position(4) and
Municipality of Residence
Principal Occupation and
Experience During Last Five
Years
Date
Appointed(1)
Number of Securities
Beneficially Owned, or
Controlled or
Directed, Directly or
Indirectly(2)
Simon Cmrlec3

Director

Age: 50

British Columbia, Canada
Chief Operating Officer of Vizsla Silver Corp. Previously Chief Operating Officer at Ausenco Limited. April 25, 2024 378,567 Spinco Shares
375,000 Spinco Options
Karlene Collier3

Director

Age: 37

British Columbia, Canada
VP Operations of Inventa Capital Corp. April 25, 2024 86,667 Spinco Options
Keith Bodnarchuk3

Director

Age: 37

British Columbia, Canada
President and Chief Executive Officer of Cosa Resources Corp. April 25, 2024 2,333 Spinco Shares

Notes:

(1) All of the directors' appointments expire at the next annual meeting of Spinco Shareholders.

(2) Upon completion of the Arrangement, based on such individual's current ownership of Vizsla Silver Shares.

(3) Member of the Audit Committee.

As of the date of this Circular, our directors do not beneficially own, control or direct, directly or indirectly own any Spinco Shares. Following completion of the Arrangement, our directors and executive officers, as a group, will beneficially own, control or direct, directly or indirectly, 1,215,309 Spinco Shares representing approximately 0.68% of the issued and outstanding Spinco Shares, and will hold options to acquire an additional 2,440,907 Spinco Shares and will hold Vizsla Silver Warrants to acquire an additional 1,667 Spinco Shares representing approximately 2.03% of the Spinco Shares on a fully-diluted basis.

The directors of Spinco will thereafter be elected by the shareholders of Spinco at each annual meeting of shareholders and will hold office until the next annual meeting of Spinco, or until his or her successor is duly elected or appointed, unless: (i) his or her office is earlier vacated in accordance with the articles of Spinco; or (ii) he or she becomes disqualified to act as a director.

CEASE TRADE ORDERS, BANKRUPTCIES, PENALTIES OR SANCTIONS

Except as otherwise disclosed, to the knowledge of Spinco, no director or executive officer:


(a) is, as at the date of this Circular, or has been, within ten years before the date of this Circular, a director, chief executive officer ("CEO") or chief financial officer ("CFO") of any company (including Vizsla Silver or Spinco) that:

(i) was the subject, while the director or executive officer was acting in the capacity as director, CEO or CFO of such company, of a cease trade, an order similar to a cease trade order or an order that denied the relevant company access to any exemption under securities legislation, that was in effect for a period of more than 30 consecutive days; or

(ii) was subject to a cease trade, an order similar to a cease trade order or an order that denied the relevant company access to any exemption under securities legislation, that was in effect for a period of more than 30 consecutive days, that was issued after the director or executive officer ceased to be a director, CEO or CFO but which resulted from an event that occurred while the director or executive officer was acting in the capacity as director, CEO or CFO of such company; or

Except as otherwise disclosed, to the knowledge of Spinco, no director or executive officer or a shareholder holding a sufficient number of securities of Spinco to affect materially the control of Spinco:

(a) is, as at the date of this Circular, or has been within ten years before the date of the Circular, a director or executive officer of any company (including Vizsla Silver or Spinco) that, while that person was acting in that capacity, or within a year of that person ceasing to act in that capacity, became bankrupt, made a proposal under any legislation relating to bankruptcy or insolvency or was subject to or instituted any proceedings, arrangement or compromise with creditors or had a receiver, receiver manager or trustee appointed to hold its assets; or

(b) has, within the ten years before the date of this Circular, become bankrupt, made a proposal under any legislation relating to bankruptcy or insolvency, or become subject to or instituted any proceedings, arrangement or compromise with creditors, or had a receiver, receiver manager or trustee appointed to hold the assets of the director executive officer or shareholder; or

(c) has been subject to any penalties or sanctions imposed by a court relating to securities legislation or by a securities regulatory authority or has entered into a settlement agreement with a securities regulatory authority; or

(d) has been subject to any penalties or sanctions imposed by a court or regulatory body that would likely be considered important to a reasonable securityholder in deciding whether to vote for a director.

CONFLICTS OF INTEREST

The directors of Spinco are required by law to act honestly and in good faith and in what the director believes to be the best interests of the company. The articles of Spinco provide that a director will forthwith after becoming aware that he or she is interested in a transaction entered into or to be entered into by the company, disclose the interest to all of the directors. If a conflict of interest arises at a meeting of the board of directors of Spinco, any director in a conflict will disclose his or her interest and abstain from voting on such matter.

Except as disclosed in this Circular, to the best of Spinco's knowledge, there are no known existing or potential conflicts of interest among Spinco and its promoters, directors, expected officers or other members of management as a result of their outside business interests except that certain of the directors, expected officers, promoters and other members of management serve as directors, officers, promoters and members of management of Vizsla Silver and other public companies, and therefore it is possible that a conflict may arise between their duties as a director, officer, promoter or member of management of such other companies.


DIRECTOR AND EXECUTIVE OFFICER COMPENSATION

COMPENSATION DISCUSSION AND ANALYSIS

At this time, no compensation has been paid to any of the directors or expected officers of Spinco. Compensation arrangements for executive officers may also include compensation in the form of bonuses and benefits arising from the grant of Spinco Options.

Following completion of the Arrangement, it is anticipated that Spinco will adopt a compensation structure for its executive officers that is appropriate for its size and the nature of its operations, while also providing an incentive for growth. Spinco expects that the initial compensation structure will reflect its intention to keep general and administrative costs low and as a cash-preserving measure, Spinco may emphasize compensation through Spinco Options. Depending on the future development of Spinco and other factors that may be considered relevant by the Spinco Board from time to time, it may be determined in the future to emphasize increased base salaries and rely to a lesser extent on share options or other incentives.

Spinco has not established an annual retainer fee or meeting attendance fee for directors. However, Spinco expects to establish directors' fees in the future and each director will be entitled to participate in any security-based compensation arrangement or other plan adopted by Spinco, from time to time, with the approval of the Spinco Board.

TERMINATION OF EMPLOYMENT, CHANGES IN RESPONSIBILITY AND EMPLOYMENT CONTRACTS

Spinco has no contract, agreement, plan or arrangement that provides for payments to a Named Executive Officer ("NEO") at, following or in connection with any termination (whether voluntary, involuntary or constructive), resignation, retirement, a change of control of Spinco or its subsidiaries or a change in responsibilities of the NEO following a change in control.

Other than as set out above, there are no termination clauses or change of control benefits in employment agreements, or any other contract, agreement, plan or arrangement with named executive officers.

OPTION-BASED AWARDS

The Spinco Option Plan will be administered by the Spinco Board, which will designate, in each year, the recipients of options and the terms and conditions of each grant, in each case in accordance with applicable securities laws and stock exchange requirements. The options and shares available to be issued under the Spinco Option Plan will be used to retain and motivate Spinco Service Providers. See "Spinco Options" and "Spinco Option Plan".

Spinco will issue one Spinco Option to acquire 1/3 of a Spinco Share for every Vizsla Silver Option outstanding on the Effective Date as a result of the Arrangement, which Spinco Options will be governed by the Spinco Option Plan.

INDEBTEDNESS OF DIRECTORS, OFFICERS AND EMPLOYEES

No individual who is a director or executive officer of Spinco, or an associate or affiliate of such an individual, is, or has been since Spinco's incorporation, indebted to Spinco. The Spinco Board will periodically review the adequacy and form of the compensation of directors and ensure that the compensation realistically reflects the responsibilities and risks involved in being an effective director.


AUDIT COMMITTEE

National Instrument 52-110 Audit Committees ("NI 52-110") of the Canadian Securities Administrators requires that Spinco's Audit Committee ("Audit Committee") meet certain requirements. It also requires Spinco to disclose in this Circular certain information regarding the Audit Committee. That information is disclosed below.

OVERVIEW

The Audit Committee is responsible for monitoring Spinco's systems and procedures for financial reporting and internal control, reviewing certain public disclosure documents and monitoring the performance and independence of Spinco's external auditors. The committee is also responsible for reviewing Spinco's annual audited financial statements, unaudited quarterly financial statements and management's discussion and analysis of financial results of operations for both annual and interim financial statements and review of related operations prior to their approval by the Board.

THE AUDIT COMMITTEE'S CHARTER

It is anticipated that the Spinco Board will adopt an audit committee charter (the "Charter"), substantially in the form attached as Schedule "H" mandating the role of the Audit Committee in supporting the Spinco Board in meeting its responsibilities to Spinco Shareholders.

COMPOSITION OF THE AUDIT COMMITTEE

The members of the Audit Committee will be elected by the Spinco Board at its first meeting following the Meeting. Unless a Chair is appointed by the Board, the members of the Audit Committee may designate a Chair by a majority vote of the full Audit Committee membership.

The following table sets out the names of the Spinco Board nominees expected to become members of the Audit Committee and whether they are "independent" and "financially literate".

Name of Member Independent(1) Financially Literate(1)
Simon Cmrlec No Yes
Keith Bodnarchuk Yes Yes
Karlene Collier Yes Yes

Note:

(1) As defined in NI 52-110.

RELEVANT EDUCATION AND EXPERIENCE

The following summarizes the education and experience of each member of the Audit Committee relevant to the performance of his responsibilities as an Audit Committee member and, in particular, any education or experience that would provide the member with:

(a) an understanding of the accounting principles used by Spinco to prepare its financial statements;

(b) the ability to assess the general application of such accounting principles in connection with the accounting for estimates, accruals and reserves;

(c) experience preparing, auditing, analyzing or evaluating financial statements that present a breadth and level of complexity of accounting issues that are generally comparable to the breadth and complexity of issues that can reasonably be expected to be raised by Spinco's financial statements, or experience actively supervising one or more persons engaged in such activities; and


(d) an understanding of internal controls and procedures for financial reporting.

Karlene Collier - Ms. Collier is a current director of Vizsla Copper Corp., TinOne Resources Inc. and Baltic I Acquisition Corp. Based on her business experience, Ms. Collier is financially literate.

Simon Cmrlec - Mr. Cmrlec serves as Chief Operating Officer at Vizsla Silver Corp. He is responsible for leading teams all over the world. Mr. Cmrlec has previously been involved with project management, designing, constructing and commissioning different mining projects. Based on his business experience, Mr. Cmrlec is financially literate.

Keith Bodnarchuk - Mr. Bodnarchuk is a Professional Geologist with a Master's degree in Business Administration. With over 15 years of experience in exploration/mining and capital markets, he is currently the President and Chief Executive Officer of Cosa Resources Corp. He most recently led strategy and corporate development for IsoEnergy Limited in Vancouver, British Columbia. Prior to this, he served as Project Geologist at Denison Mines, with a focus on North American and African projects. Mr. Bodnarchuk has been the Corporate Development Manager of Vizsla Copper Corp. since September 2021. Based on his business experience and education, Mr. Bodnarchuk is financially literate.

PRE-APPROVAL POLICIES AND PROCEDURES

The Spinco Board anticipates adopting the Charter, substantially in the form attached as Schedule "H" of this Circular, which contains policies and procedures for the engagement of nonaudit services. The Audit Committee will be responsible for the pre-approval of all audit services and permissible non-audit services to be provided to Spinco by the external auditors subject to any exceptions provided in NI 52-110.

EXTERNAL AUDITORS SERVICE FEES (BY CATEGORY)

Spinco has not paid any fees to MNP LLP in respect of audit fees, audit-related fees, tax fees or other fees for in each of the last two fiscal years and any such fees incurred to date will be paid by Vizsla Silver.

EXEMPTION IN SECTION 6.1 OF NI 52-110

Spinco is relying on the exemption in Section 6.1 of NI 52-110 from the requirement of Part 3 (Composition of the Audit Committee) and Part 5 (Reporting Obligations).

CORPORATE GOVERNANCE

National Policy 58-201 - Corporate Governance Guidelines ("NP 58-201") establishes corporate governance guidelines which apply to all reporting issuers. The guidelines deal with such matters as the constitution and independence of corporate boards, their functions, the effectiveness and education of board members and other items dealing with sound corporate governance practices. The Spinco Board considers that some of the guidelines in NP 58- 201 are not suitable for Spinco at its current stage of development and therefore these guidelines have not been adopted. National Instrument 58-101 - Disclosure of Corporate Governance Practices mandates disclosure of corporate governance practices, which disclosure is set out below.

BOARD OF DIRECTORS

The Spinco Board will facilitate its exercise of independent supervision over Spinco's management through regular meetings of the Spinco Board held to obtain an update on significant corporate activities and plans, both with and without members of Spinco's management being in attendance.

The Spinco Board has determined that two of its directors, namely Karlene Collier and Keith Bodnarchuk are independent based upon the tests for independence set forth in NI 52-110. Michael Konnert and Simon Cmrlec are not considered independent based upon the test for independence set forth in NI 52-110, as Mr. Konnert is the Chief Executive Officer of Vizsla Silver and Mr. Cmrlec is the Chief Operating Officer of Vizsla Silver.


DIRECTORSHIPS

Certain of our directors are presently directors of other reporting issuers (or equivalent) in Canada or a foreign jurisdiction, as set out below:

Director Name of Issuer Exchange Listed
Michael Konnert Summa Silver Corp.
Vizsla Silver Corp.
Vizsla Copper Corp.
TSXV
TSXV, NYSE
TSXV
Simon Cmrlec Vizsla Silver Corp.
Vizsla Copper Corp.
TSXV, NYSE
TSXV
Karlene Collier TinOne Resources Inc.
Baltic I Acquisition Corp.
Targa Exploration Corp.
Vizsla Copper Corp.
TSXV
TSXV
CSE
TSXV
Keith Bodnarchuk Cosa Resources Corp. TSXV

ORIENTATION AND CONTINUING EDUCATION

Spinco has not yet developed a formal orientation and training program for directors. If and when new directors are added, they will be provided with:

(a) information respecting the functioning of the Board, committees and copies of Spinco's corporate governance policies;

(b) access to recent, publicly filed documents of Spinco, technical reports and Spinco's internal financial information;

(c) access to management and technical experts and consultants; and

(d) a summary of significant corporate and securities responsibilities.

Spinco Board members will be encouraged to communicate with management, auditors and technical consultants, to keep themselves current with industry trends and developments and changes in legislation with management's assistance, and to attend related industry seminars. Spinco Board members will have full access to Spinco's records.

ETHICAL BUSINESS CONDUCT

The Spinco Board has responsibility for the stewardship of Spinco, including responsibility for strategic planning, identification of the principal risks of Spinco's business and implementation of appropriate systems to manage these risks, succession planning (including appointing, training and monitoring senior management) and the integrity of the Spinco's internal control and management information systems. To facilitate meeting this responsibility, the Spinco Board seeks to foster a culture of ethical conduct by striving to ensure that Spinco carries out its business in line with high business and moral standards and applicable legal and financial requirements. In that regard, the Spinco Board:


(a) will adopt a written Code of Conduct for its directors, officers, employees and consultants. A copy of which will be posted under its profile on SEDAR+;

(b) encourages management to consult with legal and financial advisors to ensure that Spinco is meeting those requirements;

(c) is cognizant of Spinco's timely disclosure obligations upon becoming a reporting issuer under Canadian securities laws and will review material disclosure documents such as financial statements, MD&A and press releases prior to their distribution;

(d) will rely on its Audit Committee to annually review the systems of internal financial control and discuss such matters with Spinco's external auditor; and

(e) will actively monitor Spinco's compliance with the Spinco Board's directives and ensure that all material transactions are thoroughly reviewed and authorized by the Spinco Board before being undertaken by management.

NOMINATION OF DIRECTORS

Spinco does not have a stand-alone nomination committee. The full Spinco Board will have responsibility for identifying potential Spinco Board candidates. The Spinco Board will assess potential Spinco Board candidates to fill perceived needs on the Spinco Board for required skills, expertise, independence and other factors. Members of the Spinco Board and representatives of the mining industry will be consulted for possible candidates.

COMPENSATION

The full Board of Directors of Spinco has the responsibility for determining compensation for the directors and senior management.

To determine future compensation payable, the Spinco Board will review compensation paid to directors and CEOs of companies of similar size and stage of development in the mining/royalty industry and determine an appropriate compensation reflecting the need to provide incentive and compensation for the time and effort expended by the directors and senior management while taking into account the financial and other resources of Spinco. In setting the compensation, the Spinco Board will annually review the performance of the CEO, in light of Spinco's objectives, and consider other factors that may have impacted the success of Spinco in achieving its objectives.

As previously discussed in this Circular, Spinco has no current arrangements, standard or otherwise, pursuant to which directors are compensated by Spinco for their services in their capacity as directors, or for committee participation, involvement in special assignments or for services as a consultant or expert.

BOARD COMMITTEES

The Company has one committee at present, being the Audit Committee.

The Audit Committee is comprised of three of Spinco's directors: Karlene Collier, Keith Bodnarchuk and Simon Cmrlec.

As the directors are expected to be actively involved in the operations of Spinco and the size of Spinco's operations does not warrant a larger board of directors, the Spinco Board has determined that additional standing committees are not necessary at this stage of Spinco's development.

ASSESSMENTS

The Spinco Board does not consider that formal assessments would be useful at this stage of Spinco's development. The Spinco Board will conduct informal annual assessments of the Spinco Board's effectiveness, the individual directors and each of its committees. To assist in its review, the Spinco Board expects to conduct informal surveys of its directors.


RISK FACTORS

Below are certain risk factors relating to Spinco that Shareholders should carefully consider in connection with and following the Arrangement. The following information is a summary only of certain risk factors and is qualified in its entirety by reference to, and must be read in conjunction with, the detailed information that appears elsewhere in the Circular. Additional risk factors relating to Spinco and its shareholders in connection with the Arrangement are set out in the Circular under the heading entitled "Risk Factors".

SPINCO SHARES WILL NOT BE LISTED ON ANY STOCK EXCHANGE

While Spinco has made an application with the TSXV to list the Spinco Shares and Spinco Warrants, there is no guarantee when, or if, such listings will be completed. Such listings will be subject to Spinco fulfilling all of the listing requirements of the TSXV. Until the Spinco Shares and Spinco Warrants are listed on a stock exchange, Spinco Shareholders and Spinco Warrantholders, as applicable, may not be able to sell their Spinco Shares or Spinco Warrants. This may affect the pricing of the Spinco Shares and Spinco Warrants in the secondary market and the liquidity of the Spinco Shares and Spinco Warrants. Spinco Shareholders and Spinco Warrantholders are advised to consult their legal advisors with respect to trading of the Spinco Shares and Spinco Warrants. Even if a listing is obtained, the holding of Spinco Shares and Spinco Warrants will involve a high degree of risk and should be undertaken only by investors whose financial resources are sufficient to enable them to assume such risks and who have no need for immediate liquidity in their investment.

SPINCO SHARES MAY NOT BE "QUALIFIED INVESTMENTS"

The Spinco Shares and Spinco Warrants distributed to Vizsla Silver Shareholders pursuant to the Arrangement will not qualify as "qualified investments" under the Tax Act for Registered Plans or a DPSP unless (i) on or before its filing due date for its first taxation year, the Spinco Shares are listed on a "designated stock exchange" as defined in the Tax Act (or Spinco otherwise satisfies the conditions to be a "public corporation" for purposes of the Tax Act), and Spinco validly elects to be a "public corporation" for purposes of the Tax Act from the commencement of its first taxation year, and (ii) in case of the Spinco Warrants, neither Spinco, nor any person with whom Spinco does not deal at arm's length, is an annuitant, a beneficiary, an employer or a subscriber under, or a holder of a particular Registered Plan or a DPSP. No assurance can be given as to whether Spinco will qualify as a "public corporation".

Where a Registered Plan acquires a Spinco Share or Spinco Warrants in circumstances where the Spinco Shares or Spinco Warrants are not a qualified investment under the Tax Act for the Registered Plan, adverse tax consequences may arise for the Registered Plan and the Controlling Individual of the Registered Plan, including that the Registered Plan or the Controlling Individual of the Registered Plan may become subject to penalty taxes.

See "Material Income Tax Considerations - Holders Resident in Canada - Eligibility for Investment - New Vizsla Silver Shares and Spinco Shares" in the Circular.

ROYALTIES, STREAMS AND SIMILAR INTERESTS MAY NOT BE HONOURED BY OPERATORS OF A PROJECT

Royalties, streams and similar interests are typically contractually based. Parties to contracts do not always honour contractual terms and contracts themselves may be subject to interpretation or technical defects.

Non-performance by Spinco's counterparties may occur if such counterparties find themselves unable to honour their contractual commitments due to financial distress or other reasons. In such circumstances, Spinco may not be able to secure similar agreements on as competitive terms or at all. No assurance can be given that the Spinco's financial results will not be adversely affected by the failure of a counterparty or counterparties to fulfill their contractual obligations in the future. Such failure could have a material adverse effect on Spinco's business, results of operations and financial condition.


To the extent grantors of royalties, streams and similar interests that are or may be held by the Company do not abide by their contractual obligations, Spinco may be forced to take legal action to enforce its contractual rights. Such litigation may be time consuming and costly and, as with all litigation, no guarantee of success can be made. Should any such decision be determined adversely to Spinco, it may have a material adverse effect on Spinco's business, results of operations and financial condition.

SPINCO FINANCING

There is no assurance that Spinco will complete the Spinco Financing. If such financing is not completed, Spinco may not meet the initial listing requirements of the TSXV.

LIMITED OR NO ACCESS TO DATA OR THE OPERATIONS UNDERLYING ITS INTERESTS

Spinco is not, and will not be, the owner or operator of any of the properties underlying its current or future royalties, streams and similar interests and has no input in the exploration, development or operation of such properties. Consequently, Spinco has limited or no access to related exploration, development or operational data or to the properties themselves. This could affect Spinco's ability to assess the value of a royalty or similar interest. This could also result in delays in cash flow from that anticipated by Spinco, based on the stage of development of the properties underlying its royalties and similar interests. Spinco's entitlement to payments in relation to such interests may be calculated by the royalty payors in a manner different from Spinco's projections and Spinco may not have rights of audit with respect to such interests. In addition, some royalties, streams or similar interests may be subject to confidentiality arrangements that govern the disclosure of information with regard to such interests and, as a result, Spinco may not be in a position to publicly disclose related non-public information. The limited access to data and disclosure regarding the exploration, development and production of minerals from, or the continued operation of, the properties in which Spinco has an interest may restrict Spinco's ability to assess value, which may have a material adverse effect on Spinco's business, results of operations and financial condition. Spinco attempts to mitigate this risk by building relationships with various owners, operators and counterparties, in order to encourage information sharing.

RISKS FACING OWNERS AND OPERATORS

To the extent that they relate to the exploration, development and production of minerals from, or the continued operation of, the properties in which Spinco holds or may hold royalties, streams or similar interests, Spinco will be subject to the risk factors applicable to the owners and operators of such mines or projects.

Mineral exploration, development and production generally involves a high degree of risk. Such operations are subject to all of the hazards and risks normally encountered in the exploration, development and production of metals, including weather related events, unusual and unexpected geology formations, seismic activity, environmental hazards and the discharge of toxic chemicals, explosions and other conditions involved in the drilling, blasting and removal of material, any of which could result in damage to, or destruction of, mines and other producing facilities, damage to property, injury or loss of life, environmental damage, work stoppages, delays in exploration, development and production, increased production costs and possible legal liability. Any of these hazards and risks and other acts of God could shut down such activities temporarily or permanently. Mineral exploration, development and production is subject to hazards such as equipment failure or failure of retaining dams around tailings disposal areas, which may result in environmental pollution and consequent liability for the owners or operators thereof. The exploration for, and development, mining and processing of, mineral deposits involves significant risks that even a combination of careful evaluation, experience and knowledge may not eliminate.

DEPENDENCE ON FUTURE PAYMENTS FROM OWNERS AND OPERATORS

Spinco will be dependent to a large extent on the financial viability and operational effectiveness of owners and operators of the properties underlying the royalties, streams and similar interests that are or may be held by Spinco. Payments from production generally flow through the operator and there is a risk of delay and additional expense in receiving such revenues. Payments may be delayed by restrictions imposed by lenders, delays in the sale or delivery of products, recovery by the operators of expenses, the establishment by the operators of mineral reserves for such expenses or the bankruptcy, insolvency or other adverse financial condition of the operator. Spinco's rights to payment under royalties and similar interests must, in most cases, be enforced by contract without the protection of a security interest over property that Spinco could readily liquidate. This inhibits Spinco's ability to collect outstanding royalties in the event of a default. In the event of a bankruptcy, insolvency or other arrangement of an operator or owner, Spinco will be treated like any other unsecured creditor, and therefore have a limited prospect for full recovery of royalty or similar revenue.


INVESTMENT PRICE RISKS

The value of Spinco's current and future equity investments, is and will be exposed to fluctuations in the quoted market price depending on a number of factors, including general market conditions, company specific operating performance and the market price of certain commodities. Spinco does not utilize any derivative contracts to reduce this exposure. Spinco may be unable to sell its entire interest in an investment without having an adverse effect on the fair value of the security due to low trading volumes on some investments.

RISKS RELATED TO MINERAL RESERVES AND RESOURCES

The mineral reserves and resources on properties underlying the royalties, streams or similar interests that are or may be held by Spinco are estimates only, and no assurance can be given that the estimated reserves and resources are accurate or that the indicated level of minerals will be produced. Such estimates are, in large part, based on interpretations of geological data obtained from drill holes and other sampling techniques. Actual mineralization or formations may be different from those predicted by the owners or operators of the properties. Further, it may take many years from the initial phase of drilling before production is possible and, during that time, the economic feasibility of exploiting a discovery may change. Market price fluctuations of commodities, as well as increased production and capital costs or reduced recovery rates, may render the proven and probable reserves on properties underlying the royalties, streams or similar interests that are or may be held by Spinco unprofitable to develop at a particular site or sites for periods of time or may render reserves containing relatively lower grade mineralization uneconomic. Moreover, short-term operating factors relating to the reserves, such as the need for the orderly development of ore bodies or the processing of new or different ore grades, may cause reserves to be reduced or not extracted. Estimated reserves may have to be recalculated based on actual production experience. The economic viability of a mineral deposit may also be impacted by other attributes of a particular deposit, such as size, grade and proximity to infrastructure; by governmental regulations and policy relating to price, taxes, royalties, land tenure, land use permitting, the import and export of minerals and environmental protection; and by political and economic stability.

Resource estimates in particular must be considered with caution. Resource estimates for properties that have not commenced production are based, in many instances, on limited and widely spaced drill holes or other limited information, which is not necessarily indicative of the conditions between and around drill holes. Such resource estimates may require revision as more drilling or other exploration information becomes available or as actual production experience is gained. Further, resources may not have demonstrated economic viability and may never be extracted by the operator of a property. It should not be assumed that any part or all of the mineral resources on properties underlying the royalties, streams or similar interests that are or may be held by Spinco constitute or will be converted into reserves. Any of the foregoing factors may require operators to reduce their reserves and resources, which may have a material adverse effect on Spinco's business, results of operations and financial condition.

RIGHTS OF THIRD PARTIES

Some royalty, stream and similar interests that are or may be held by Spinco may be subject to buy-down right provisions, pursuant to which an operator may buy-back all or a portion of the stream or royalty; pre-emptive rights, pursuant to which parties have the right of first refusal or first offer with respect to a proposed sale or assignment of the stream or royalty; or claw back rights, pursuant to which the seller of a stream or royalty has the right to re-acquire the stream or royalty. The exercise of any such rights by the holders thereof may adversely affect the value of the applicable royalty, stream or similar interest of Spinco.

COSTS MAY INFLUENCE RETURN

Net profit royalties and similar interests allow the operator to account for the effect of prevailing cost pressures on the project before calculating a royalty. These cost pressures may include costs of labour, equipment, electricity, environmental compliance, and numerous other capital, operating and production inputs. Such costs will fluctuate in ways Spinco will not be able to predict, will be beyond the control of Spinco and can have a dramatic effect on the revenue payable on these royalties and similar interests. Any increase in the costs incurred by operators on applicable properties will likely result in a decline in the royalty revenue received by Spinco. This, in turn, will affect overall revenue generated by Spinco, which may have a material adverse effect on its business, results of operations and financial condition.


GLOBAL FINANCIAL CONDITIONS

Global financial conditions could suddenly and rapidly destabilize in response to future events, as government authorities may have limited resources to respond to future crises. Future crises may be precipitated by any number of causes, including natural disasters, geopolitical instability, changes to energy prices or sovereign defaults. Any sudden or rapid destabilization of global economic conditions could negatively impact Spinco's ability, or the ability of the owners or operators of the properties in respect of which it holds royalties or other interests, to obtain equity or debt financing or make other suitable arrangements to finance their projects. In the event of increased levels of volatility or a rapid destabilization of global economic conditions, Spinco's profitability, results of operations and financial condition and the trading price of its securities could be adversely affected.

LIQUIDITY CONCERNS AND FUTURE FINANCING REQUIREMENTS

Spinco has no current source of operating revenue and may require additional financing in order to fund its business plan. Spinco's ability to arrange such financing in the future will depend, in part, on prevailing capital market conditions, as well as its business success. There can be no assurance that Spinco will be successful in any efforts to arrange additional financing on terms satisfactory to it, or at all. If additional financing is raised by the issuance of Spinco Shares or securities exchangeable for or convertible into Spinco Shares, control of Spinco may change, and investors may suffer additional dilution. If adequate funds are not available, or are not available on acceptable terms, Spinco may not be able to operate its business at its maximum potential, to expand, to take advantage of other opportunities, or to otherwise remain in business.

Because of their size and scale, the success of some resource-based projects depends on the ability of the owners to raise the capital required to successfully explore, develop and operate a project. This ability may be affected by general economic and market conditions, including the perceived threat or actual occurrence of an economic recession or liquidity issues. If market conditions are not favorable, major resource-based projects could be cancelled or delayed, and any return to Spinco would be extinguished or significantly delayed or diminished.

In the event that Spinco is unable to secure necessary financing in the future, it may be forced to liquidate some or all of its assets, including its investments in other publicly traded issuers. In such event, there is no certainty that such sales would yield sufficient proceeds and such sales could have a material adverse effect on Spinco's business, results of operations and financial condition.

COMPETITION FOR ROYALTIES, STREAMS AND OTHER SIMILAR INTERESTS

The business of Spinco is competitive in all phases, with many companies engaged in the acquisition of royalties, streams and similar interests, including large, established companies with substantial financial resources and long earnings records. Moreover, there is only a limited number of active projects globally and, accordingly, there will be limited opportunities for additional acquisitions and investments by Spinco. Spinco may be at a competitive disadvantage in acquiring additional interests, whether by way of royalty, stream or other form of investment, as competitors may have greater financial resources and technical staff. There can be no assurance that Spinco will be able to compete successfully against other companies in acquiring additional royalties, streams or similar interests. In addition, Spinco may be unable to acquire royalties, streams or similar interests at acceptable valuations, which may have a material adverse effect on Spinco's business, results of operations and financial condition.

RISKS RELATED TO FOREIGN JURISDICTION AND EMERGING MARKETS

Some of the properties on which Spinco holds or may hold royalties, streams or similar interests are located outside of Canada. In addition, future investments may expose Spinco to additional jurisdictions. The exploration, development and production of minerals from, or the continued operation of, these properties by their owners and operators are subject to the risks normally associated with conducting business in foreign countries. These risks include, depending on the country, nationalization and expropriation, social unrest and political instability, less developed legal and regulatory systems, uncertainties in perfecting mineral titles, trade barriers, exchange controls and material changes in taxation. These risks may, among other things, limit or disrupt the ownership, development or operation of properties, mines or projects in respect of which the royalties, streams or similar interests that are or may be held by Spinco, restrict the movement of funds, or result in the deprivation of contractual rights or the taking of property by nationalization or expropriation without fair compensation.


LACK OF LIQUIDITY IN MINING COMPANY INVESTMENTS

Spinco may make additional investments in securities of companies involved in the mining industry in the future. Some of the companies in which Spinco may invest may be thinly traded and some may have no market at all. There are no restrictions on the investment by Spinco in illiquid securities. It is possible that Spinco may not be able to sell such positions, in whole or in part, without facing substantially adverse prices. If Spinco is required to transact in such securities before its intended investment horizon, the performance of Spinco could suffer.

FOLLOWING THE ARRANGEMENT, SPINCO MAY BE UNABLE TO MAKE THE CHANGES NECESSARY TO OPERATE AS AN INDEPENDENT ENTITY AND MAY INCUR GREATER COSTS

Following the Arrangement, the separation of Spinco from the other business of Vizsla Silver may materially affect Spinco. Spinco may not be able to implement successfully the changes necessary to operate independently. Spinco may incur additional costs relating to operating independently that could materially affect its cash flows and results of operations. Spinco may require Vizsla Silver to provide Spinco with certain services and facilities on a transitional basis. Spinco may, as a result, be dependent on such services and facilities until it is able to provide or obtain its own.

SPINCO HAS NOT HAD A SEPARATE OPERATING HISTORY AS A STAND-ALONE ENTITY

Upon the Arrangement becoming effective, Spinco will become an independent company. The operating history of Vizsla Silver cannot be regarded as the operating history of Spinco. The ability of Spinco to raise capital, satisfy its obligations and provide a return to its shareholders will be dependent on future performance. It will not be able to rely on the capital resources and cash flows of Vizsla Silver.

LIMITED OPERATING HISTORY AND UNCERTAINTY OF FUTURE REVENUES

Spinco has a limited operating history. It is therefore difficult to evaluate Spinco's business and future prospects. In particular, Spinco is at an early stage of development with operating losses expected to continue for the foreseeable future. The future success of Spinco is dependent on the Spinco Board's ability to implement its strategy. While the Spinco Board is optimistic about Spinco's prospects, there is no certainty that anticipated outcomes and sustainable revenue streams will be achieved. Spinco faces risks frequently encountered by developing companies. In particular, its future growth and prospects will depend on its ability to manage growth and to continue to expand and improve operational, financial and management information and quality control systems on a timely basis, while at the same time maintaining effective cost controls. Any failure to expand and improve operational, financial and management information and quality control systems in line with Spinco growth could have a material adverse effect on Spinco's business, financial condition and results of operations.

ACQUISITION OR BUSINESS ARRANGEMENT

Spinco will seek new opportunities in the mining royalty industry. In pursuit of such opportunities, Spinco may fail to select appropriate investments or negotiate acceptable arrangements, including arrangements to finance acquisitions or integrate the acquired businesses and their workforce into Spinco. Ultimately, any acquisitions would be accompanied by risks, which could include change in commodity prices, difficulty with integration, failure to realize anticipated synergies, significant unknown liabilities, delays in regulating approvals and exposure to litigation. Any material issues that Spinco encounters in connection with an acquisition could have a material adverse effect on its business, results or operations and financial position.


MARKET PRICE AND TRADING OF SPINCO SHARES AND SPINCO WARRANTS

While Spinco has made an application with the TSXV to list the Spinco Shares and Spinco Warrants, there is no guarantee when, or if, such listings will be completed. Such listings will be subject to Spinco fulfilling all of the listing requirements of the TSXV. An active and liquid market for the Spinco Shares and Spinco Warrants may not develop following completion of the Arrangement or, if developed, may not be maintained. If an active public market does not develop or is not maintained, investors may have difficulty selling their Spinco Shares and Spinco Warrants at any given time at a price that the investor may consider reasonable. The lack of an active market may also reduce the fair market value and increase the volatility of the Spinco Shares and Spinco Warrants and may impair Spinco's ability to raise capital by selling Spinco Shares.

MINING IS A HIGH-RISK BUSINESS

Spinco's principal operation will be the acquisition of royalties, streams and similar interests. Its operations will be subject to all of the hazards and risks normally encountered in the mining and processing of minerals. These include unusual and unexpected geological formations, rock falls, flooding and other conditions involved in the extraction of material, any of which could result in damage to, or destruction of, mines and other producing facilities, damage to or loss of life or property, environmental damage and possible legal liability. Although adequate precautions to minimize risk will be taken, operations are subject to hazards, which may result in environmental pollution and consequent liability which could have a material adverse effect on the business, operations and financial performance of Spinco. As is common with all mining operations, there is uncertainty and therefore risk associated with Spinco's operating parameters and costs. These can be difficult to predict and are often affected by factors outside Spinco's control.

GOVERNMENT REGULATION RISK

The properties underlying the royalties, streams or similar interests that are or may be held by Spinco are subject to various laws governing prospecting, development, production, exports, imports, taxes, labour standards and occupational health and safety, mine safety, toxic substances, waste disposal, environmental protection and remediation, protection of endangered and protected species, land use, water use, land claims of local people and other matters. No assurance can be given that new rules and regulations will not be enacted or that existing rules and regulations will not be applied in a manner which could have an adverse effect on Spinco's financial position. Amendments to current laws, regulations and permits governing development activities and activities of mining and exploration companies, or more stringent or different implementation, could have a material adverse impact on Spinco's financial position. Failure to comply with any applicable laws, regulations or permitting requirements may result in enforcement actions against Spinco. Any such regulatory or judicial action could materially increase Spinco's negatively impact Spinco's operations.

ENVIRONMENTAL RISKS AND HAZARDS

All phases of the properties underlying the royalties, streams or similar interests that are or may be held by Spinco are subject to environmental regulation in the jurisdictions in which they operate. These regulations mandate, among other things, the maintenance of air and water quality standards and land reclamation. They also set out limitations on the generation, transportation, storage and disposal of solid and hazardous waste. Environmental legislation is evolving in a manner which will likely, in the future, require stricter standards and enforcement, increased fines and penalties for non-compliance, more stringent environmental assessments of proposed projects and heightened degree of responsibility for companies and their officers, directors and employees. There is no assurance that future changes in environmental regulation, if any, will not adversely affect the mining industry.

Failure to comply with applicable laws, regulations and permitting requirements may result in enforcement actions thereunder, including orders issued by regulatory or judicial authorities causing operations on properties underlying the royalties, streams or similar interests to cease or be curtailed, and may include corrective measures requiring capital expenditures, installation of additional equipment or remedial actions. Parties engaged in mining operations or in the exploration or development of mineral properties may be required to compensate those suffering loss or damage by reason of the mining activities and may have civil or criminal fines or penalties imposed for violations of applicable laws or regulations.


NO HISTORY OF DIVIDENDS

Spinco has not paid a dividend on the Spinco Shares since incorporation. Spinco intends to continue to retain earnings and other cash resources for its business. Any future determination to pay dividends will be at the discretion of the Spinco Board and will depend upon the capital requirements of Spinco, results of operations and such other factors as the Spinco Board considers relevant.

SPINCO MAY BECOME, IN THE FUTURE, SUBJECT TO LEGAL PROCEEDINGS

Spinco may become party to legal claims arising in the ordinary course of business. There can be no assurance that any such legal claims will not result in significant costs to Spinco. In addition, potential litigation may arise on a property underlying the royalties, streams and similar interests that are or may be held by Spinco (for example, litigation between joint venture partners or between operators and original property owners or neighbouring property owners). As a royalty, stream or similar interest holder, Spinco will not generally have any influence on the litigation and will not generally have any access to data. Any such litigation that inhibits the exploration, development and production of minerals from, or the continued operation of, a property underlying the royalties, streams and similar interests that are or may be held by Spinco could have a material adverse effect on Spinco's business, results of operations and financial condition.

DEPENDENCE ON GOOD RELATIONS WITH EMPLOYEES

The success of Spinco's operations depends on the skills and abilities of its employees. There is intense competition for individuals with expertise in mining, natural resources and finance. The ability of Spinco to hire and retain these individuals is key to the mining operations. Further, relations with employees may be affected by changes in the scheme of labour relations that may be introduced by the relevant governmental authorities in the jurisdictions in which the mining operations are conducted. Changes in such legislation or otherwise in Spinco's relationships with its employees may result in strikes, lockouts or other work stoppages, any of which could have a material adverse effect on the mining operations, results of operations and financial condition.

UNINSURABLE RISKS

In the course of development of the properties underlying the royalties, streams or similar interests that are or may be held by Spinco, Spinco is subject to a number of risks and hazards generally, including adverse environmental conditions, industrial accidents, labour disputes, unusual or unexpected geological conditions, ground or slope failures, mechanical failures, changes in the regulatory environment and natural phenomena such as inclement weather conditions, floods and earthquakes. Such occurrences could result in damage to mineral properties or production facilities, personal injury or death, delays in mining, monetary losses and possible legal liability.

MANAGEMENT

The success of Spinco will be largely dependent on the performance of its board of directors and its senior management. There is no assurance Spinco can maintain the services of its board of directors and management or other qualified personnel required to operate its business. Failure to do so could have material adverse effect on Spinco and its prospects.

KEY PERSONNEL

Spinco's success is highly dependent on the retention of key personnel who possess specialized expertise and are well versed in the natural resource, mining and finance sectors. The availability of persons with the necessary skills to execute Spinco's business strategy is very limited and competition for such persons is intense. As Spinco's business activity grows, additional key financial and administrative personnel, as well as additional staff, may be required. Although Spinco believes it will be successful in attracting, training and retaining qualified personnel, there can be no assurance of such success. If Spinco is not successful in attracting, training and retaining qualified personnel, the efficiency of its operations may be affected.


CORRUPTION AND BRIBERY LAWS

Spinco's operations are governed by, and involve interactions with, many levels of government in numerous countries. Spinco is required to comply with anti-corruption and anti-bribery laws, including the Criminal Code, and the Canadian Corruption of Foreign Public Officials Act, as well as similar laws in the countries in which Spinco conducts its business. In recent years, there has been a general increase in both the frequency of enforcement and the severity of penalties under such laws, resulting in greater scrutiny and punishment to companies convicted of violating anticorruption and antibribery laws. Furthermore, a company may be found liable for violations by not only its employees, but also by its contractors and third-party agents. Although Spinco has adopted steps to mitigate such risks, including the implementation of training programs, internal monitoring, reviews and audits, and policies to ensure compliance with such laws, such measures may not always be effective in ensuring that Spinco, its employees, contractors or third-party agents will comply strictly with such laws. If Spinco finds itself subject to an enforcement action or is found to be in violation of such laws, this may result in significant penalties, fines and/or sanctions imposed on Spinco resulting in a material adverse effect on Spinco's reputation and results of its operations.

SPINCO'S FINANCIAL STATEMENTS AND PRO FORMA FINANCIAL STATEMENTS MAY NOT REFLECT WHAT SPINCO'S FINANCIAL POSITION, RESULTS OF OPERATIONS OR CASH FLOWS WILL BE IN THE FUTURE

Spinco believes management has made reasonable assumptions underlying Spinco's financial statements and pro forma financial statements, including reasonable allocations of corporate expenses from Vizsla Silver, such as expenses related to employee benefits, finance, human resources, legal, information technology and executive management. However, because Spinco's financial statements are based on certain assumptions and include allocations of corporate expenses from Vizsla Silver, Spinco's financial statements may not reflect what Spinco's financial position, results of operations or cash flows would have been had Spinco operated as a stand-alone company during the historical periods presented or what Spinco's financial position, results of operations or cash flows will be in the future.

REPORTING ISSUER OBLIGATIONS

Spinco's business is subject to evolving corporate governance and public disclosure regulations that have increased both Spinco's compliance costs and the risk of non-compliance, which could adversely impact Spinco's share price.

Spinco is subject to changing rules and regulations promulgated by a number of governmental and self-regulated organizations, including the Canadian Securities Administrators and the International Accounting Standards Board. These rules and regulations continue to evolve in scope and complexity creating many new requirements.

Spinco's efforts to comply with such legislation could result in increased general and administration expenses and a diversion of management time and attention from revenue-generating activities to compliance activities.

INCOME, FEDERAL, STATE AND MUNICIPAL TAXES

Spinco is subject to income taxes in Canada. No assurance can be given that new taxation rules will not be enacted in Canada, or that existing rules will not be applied in a manner which could result in Spinco's profits being subject to increased income tax.

INCOME TAX CONSIDERATIONS

The fair market value of the Spinco Shares and Spinco Warrants immediately following the exchange of Vizsla Silver Class A Shares for New Vizsla Silver Shares, Spinco Shares and Spinco Warrants cannot be determined precisely and will impact the tax consequences of participating in the Arrangement.

No tax ruling has been received from the authorities in Canada or the United States in respect of tax consequences of participating in the Arrangement.


CHANGE IN CLIMATE CONDITIONS

Governments are moving to introduce climate change legislation and treaties at the international, national, state/province and local levels. Regulation relating to emission levels (such as carbon taxes) and energy efficiency is becoming more stringent. If the current regulatory trend continues, Spinco expects that this will result in increased costs. In addition, physical risk of climate change may also have an adverse effect on Spinco's operations. These risks include: sea level rise, extreme weather events, and resource shortages due to disruption of delivery item. Spinco can provide no assurance that efforts to mitigate the risks of climate changes will be effective and that the physical risks of climate change will not have an adverse effect on its operations.

PUBLIC HEALTH CRISES

Spinco's business could be significantly adversely affected by the outbreak of epidemics or pandemics or other public health crises. Spinco cannot accurately predict the impact epidemics, pandemics or public health crises will have on third parties' ability to meet their obligations with Spinco. In addition, a significant outbreak of contagious diseases in the human population could result in a widespread health crisis that could adversely affect the economies and financial markets of many countries, resulting in an economic downturn that could affect demand for Spinco's services and likely impact operating results.

INFORMATION SYSTEMS

Targeted attacks on Spinco's systems (or on systems of third parties that Spinco relies on), failure or non-availability of a key information technology ("IT") systems or a breach of security measures designed to protect Spinco's IT systems could result in disruptions to Spinco's operations, extensive personal injury, property damage or financial or reputational risks. Spinco has engaged IT consultants to implement and test system controls and disaster recovery infrastructure for certain IT systems. As the threat landscape is ever-changing, Spinco must make continuous mitigation efforts, including: risk prioritized controls to protect against known and emerging threats; tools to provide automate monitoring and alerting and backup and recovery systems to restore systems and return to normal operations.

THE POSSIBLE ISSUANCE OF ADDITIONAL SPINCO SHARES MAY IMPACT THE VALUE OF SPINCO SHARES

Spinco is authorized to issue an unlimited number of Spinco Shares without par value. Sales of substantial amounts of Spinco Shares (including Spinco Shares issuable upon the exercise of Spinco Options and Spinco Warrants), or the perception that such sales could occur, could materially adversely affect prevailing market prices for the common shares and the ability of Spinco to raise equity capital in the future.

ADDITIONAL FINANCINGS MAY RESULT IN DILUTION

Spinco may require additional funds to further its activities and objectives. To obtain such funds, Spinco may issue additional securities, including Spinco Shares or securities convertible into or exchangeable for Spinco Shares. As a result, Spinco's shareholders could be substantially diluted. In addition, there can be no assurance that Spinco will be able to obtain sufficient financing in the future on terms favourable to Spinco or at all.

PFIC CONSIDERATIONS

Spinco will likely be a passive foreign investment company, or "PFIC," which could result in adverse U.S. federal income tax consequences to Spinco's U.S. shareholders. If Spinco is a PFIC for any taxable year (or portion thereof) that is included in the holding period of a U.S. Holder (as defined in the Circular under "Material Income Tax Considerations - Material United States Federal Income Tax Considerations") in its Spinco Shares, the U.S. Holder may be subject to certain adverse U.S. federal income tax consequences and to additional reporting requirements. Spinco will endeavor to provide to a U.S. Holder such information as the IRS may require, including a PFIC annual information statement, to enable the U.S. Holder to make and maintain a qualified electing fund ("QEF") election, but there is no guarantee Spinco will be able to timely provide such required information.

If Spinco is a PFIC, Spinco may own interests in other entities that are classified as PFICs. In such event, a U.S. Holder will be deemed to own a portion of the shares of such subsidiary PFICs and could be subject to adverse U.S. federal income tax consequences with respect to such subsidiary PFICs. If a U.S. Holder makes a QEF election with respect to a subsidiary PFIC, tracking the tax bases of the U.S. Holder's interests in the tiered PFIC structure will become extremely complicated.


Prospective investors are strongly urged to review the discussion in the Circular under "Material Income Tax Considerations - Material United States Federal Income Tax Considerations" and to consult their own tax advisors regarding the possible implications of the PFIC rules on their investments in Spinco.

PROMOTER

Under applicable Canadian securities laws, Vizsla Silver may be considered a promoter of Spinco in that it took initiative in substantially reorganizing the business of Spinco.

As of the date of this Circular, Vizsla Silver is the registered holder of one Spinco Share representing all of the issued and outstanding Spinco Shares. On the Effective Date and pursuant to the Plan of Arrangement, approximately 45% of these Spinco Shares will be distributed to the shareholders of Vizsla Silver.

Immediately following the Effective Time, Vizsla Silver is expected to beneficially own, control and direct, directly or indirectly, approximately 55% of the issued and outstanding Spinco Shares.

Prior to the Listing Date, the parties intend to complete the First Loan Settlement. Following the First Loan Settlement, Vizsla Silver is expected to hold approximately 62% of the issued and outstanding Spinco Shares.

LEGAL PROCEEDINGS AND REGULATORY ACTIONS

There are no legal proceedings to which Vizsla Silver or Spinco is a party to, or in respect of which any of its assets are the subject of, that is or will be material to Spinco, and Spinco is not aware of any such legal proceedings that are contemplated.

Since incorporation, there have not been any penalties or sanctions imposed against Spinco by a court relating to provincial or territorial securities legislation or by a securities regulatory authority, nor have there been any other penalties or sanctions imposed by a court or regulatory body against Spinco, and Spinco has not entered into any settlement agreements before a court relating to provincial or territorial securities legislation or with a securities regulatory authority.

INTERESTS OF CERTAIN PERSONS IN MATERIAL TRANSACTIONS

Except as set elsewhere in this Circular, none of the directors or executive officers of Spinco, or any person that is expected to beneficially own or control or direct more than 10% of any class or series of shares of Spinco, or any associate or affiliate of any of the foregoing persons, has or has had any material interest in any past transaction within the three years before the date of this Circular, or any proposed transaction, that has materially affected or would materially affect Spinco or any of its subsidiaries.

Certain directors and officers of Spinco are also directors, officers or shareholders of other companies that are engaged in the business of acquiring, developing and exploiting natural resource properties. Such associations to other engaged companies in the resource sector may give rise to conflicts of interest from time to time. As a result, opportunities provided to a director of Spinco may not be made available to Spinco but, rather, may be offered to a company with competing interests. The directors and senior officers of Spinco are required by law to act honestly and in good faith with a view to the best interests of Spinco and to disclose any personal interest which they may have in any project or opportunity of Spinco, and to abstain from voting on such matters.

AUDITORS, TRANSFER AGENT AND REGISTRAR

Effective on completing the Arrangement, MNP LLP of MNP Tower, 1021 W Hastings Street, Vancouver, British Columbia V6E 0C3, will be the auditors of Spinco. MNP LLP are the auditors for Vizsla Silver.


The transfer agent and registrar for the Spinco Shares is Computershare. The register of transfers of the Spinco Shares is maintained by Computershare at its offices in Vancouver, British Columbia.

MATERIAL CONTRACTS

Following the completion of the Arrangement, the following will be the material contracts of Spinco, other than contracts entered into in the ordinary course of business:

1. the Arrangement Agreement; and

2. the Royalty Agreements.

Copies of the above material contracts will be available under Spinco's profile on SEDAR+.

EXPERTS

MNP LLP, Chartered Professional Accountants, prepared an auditors' report to Vizsla Silver, the sole shareholder of Spinco, on the Spinco Financial Statements as at the date of incorporation on October 13, 2023. MNP LLP has advised Vizsla Silver that it is independent with respect to Spinco within the meaning of the Code of Professional Conduct of the Chartered Professional Accountants of British Columbia.

FINANCIAL STATEMENTS DISCLOSURE

Included as Schedule "I" to this Circular are the consolidated financial statements of Spinco consisting of: (a) a statement of comprehensive income, a statement of changes in equity and a statement of cash flows; (b) a statement of financial position as at the end of the financial period; and (c) the notes thereto, for the nine months ended January 31, 2024 and 2023, as well as the year ended April 30, 2023 and 2022.

Included as Schedule "J" to this Circular are the pro forma financial statements of Royalty Corp consisting of: a) pro forma statement of financial position as at the date of Spinco's most recent statement of financial position, that gives effect to the Arrangement as if it had taken place on such date; (b) Spinco's pro forma income statement, that gives effect to the Arrangement as if it had take place at the beginning of its financial year; and (c) Spinco's pro forma earnings per share based on the pro forma financial statements.


SCHEDULE "H"

SPINCO AUDIT COMMITTEE CHARTER

The audit committee is a committee of the board of directors to which the board delegates its responsibilities for the oversight of the accounting and financial reporting process and financial statement audits.

The audit committee will:

(a) review and report to the board of directors of the Company on the following before they are published:

(i) the financial statements and MD&A (management discussion and analysis) (as defined in National Instrument 51-102) of the Company;

(ii) the auditor's report, if any, prepared in relation to those financial statements,

(b) review the Company's annual and interim earnings press releases before the Company publicly discloses this information,

(c) satisfy itself that adequate procedures are in place for the review of the Company's public disclosure of financial information extracted or derived from the Company's financial statements and periodically assess the adequacy of those procedures,

(d) recommend to the board of directors:

(i) the external auditor to be nominated for the purpose of preparing or issuing an auditor's report or performing other audit, review or attest services for the Company; and

(ii) the compensation of the external auditor,

(e) oversee the work of the external auditor engaged for the purpose of preparing or issuing an auditor's report or performing other audit, review or attest services for the Company, including the resolution of disagreements between management and the external auditor regarding financial reporting,

(f) monitor, evaluate and report to the board of directors on the integrity of the financial reporting process and the system of internal controls that management and the board of directors have established,

(g) monitor the management of the principal risks that could impact the financial reporting of the Company,

(h) establish procedures for:

(i) the receipt, retention and treatment of complaints received by the Company regarding accounting, internal accounting controls, or auditing matters; and

(ii) the confidential, anonymous submission by employees of the Company of concerns regarding questionable accounting or auditing matters,

(i) pre-approve all non-audit services to be provided to the Company or its subsidiary entities by the Company's external auditor,

(j) review and approve the Company's hiring policies regarding partners, employees and former partners and employees of the present and former external auditor of the Company, and


(k) with respect to ensuring the integrity of disclosure controls and internal controls over financial reporting, understand the process utilized by the Chief Executive Officer and the Chief Financial Officer to comply with Multilateral Instrument 52-109.

Composition of the Committee

The committee will be composed of three directors from the Company's board of directors, a majority of whom will be independent. Independence of the Board members will be as defined by applicable legislation and as a minimum each committee member will have no direct or indirect relationship with the company which, in the view of the board of directors, could reasonably interfere with the exercise of a member's independent judgment. All members of the committee will be financially literate as defined by applicable legislation. If, upon appointment, a member of the committee is not financially literate as required, the person will be provided a three-month period in which to achieve the required level of literacy.

Authority

The committee has the authority to engage independent counsel and other advisors as it deems necessary to carry out its duties and the committee will set the compensation for such advisors. The committee has the authority to communicate directly with and to meet with the external auditors and the internal auditor, without management involvement. This extends to requiring the external auditor to report directly to the committee.

Reporting Obligations

The reporting obligations of the committee will include:

(a) reporting to the board of directors on the proceedings of each committee meeting and on the committee's recommendations at the next regularly scheduled directors meeting; and

(b) reviewing, and reporting to the board of directors on its concurrence with, the disclosure required by Form 52-110F2 in any management information circular prepared by the Company.


SCHEDULE "I"

SPINCO FINANCIAL STATEMENTS AND RELATED MD&A

(Please see attached)

 

 


 

VIZSLA ROYALTIES CORP.

Condensed Consolidated Interim Financial Statements

(Expressed in Canadian Dollars - Unaudited)

For the nine months ended January 31, 2024, and 2023

 



VIZSLA ROYALTIES CORP.

Condensed Consolidated Interim Statements of Financial Position
(Expressed in Canadian dollars) - Unaudited

As at Note   January 31, 2024     April 30, 2023
(Audited)
 
      $     $  
ASSETS              
Current assets              
Cash and cash equivalents 3   21,887     55,311  
Taxes receivable 4   257,656     246,790  
Total current assets     279,543     302,101  
Non-current assets              
Royalty interests 5   1     1  
Total non-current assets     1     1  
Total assets     279,544     302,102  
               
LIABILITIES              
Current liabilities              
Accounts payable and accrued liabilities     31,050     16,538  
Due to related party 6   1,609,312     1,546,277  
Total current liabilities     1,640,362     1,562,815  
SHAREHOLDER' EQUITY              
Share capital     1     1  
Excess benefit to shareholder 5   (1,316,703 )   (1,303,565 )
Accumulated other comprehensive income     28,250     18,423  
(Deficit) / Retained earnings     (72,366 )   24,428  
Total shareholder's deficit     (1,360,818 )   (1,260,713 )
Total liabilities and shareholder's equity     279,544     302,102  

Note 1 - Nature of Operations and Going Concern

Note 10 - Subsequent Events

They are signed on the Company's behalf by:

"Michael Konnert"

Director

The accompanying notes are an integral part of these condensed consolidated interim financial statements

Page | 2


VIZSLA ROYALTIES CORP.

Condensed Consolidated Interim Statements of (Loss) Income and Comprehensive (Loss) Income
(Expressed in Canadian dollars) - Unaudited

For the nine months ended   January 31, 2024     January 31, 2023  
    $     $  
General and administrative expenses            
Foreign exchange loss / (gain)   1,381     (35,690 )
Office and miscellaneous   253     179  
Professional fees   95,160     -  
Net (loss) / income   (96,794 )   35,511  
Other comprehensive income/ (loss)            
Items that will be reclassified to profit and loss subsequently            
Translation gain on foreign operations   9,827     6,137  
Comprehensive (loss) / income   (86,967 )   41,648  
Basic and diluted (loss) / income per share   (96,794 )   35,511  
             
Weighted average number of common shares            
             
Basic and diluted   1     1  

The accompanying notes are an integral part of these condensed consolidated interim financial statements

Page | 3


VIZSLA ROYALTIES CORP.

Condensed Consolidated Interim Statements of Cash Flows
(Expressed in Canadian dollars) - Unaudited

For the nine months ended Note   January 31, 2024     January 31, 2023  
      $     $  
Operating activities              
Net (loss) / income for the period     (96,794 )   35,511  
Items not affecting cash:              
Foreign exchange loss (gain)     1,381     (35,690 )
               
Changes in non-cash working capital items:              
Accounts payable & accrued liabilities     14,512     -  
Taxes receivable 4   (10,866 )   (22,596 )
Net cash flows used in operating activities     (91,767 )   (22,775 )
               
Investing activities              
Purchase of royalty interests 5   (13,138 )   (1,514,261 )
Net cash flows used in investing activities     (13,138 )   (1,514,261 )
               
Financing activities              
Due to related party 6   63,035     1,544,970  
               
Net cash flows provided by financing activities     63,035     1,544,970  
               
Effects of foreign exchange     8,446     41,826  
               
(Decrease) / Increase in cash and cash equivalents     (33,424 )   49,760  
               
Cash and cash equivalents, beginning of the period     55,311     2,479  
               
Cash and cash equivalents, end of the period     21,887     52,239  

The accompanying notes are an integral part of these condensed consolidated interim financial statements

Page | 4


VIZSLA ROYALTIES CORP.

Condensed Consolidated Interim Statements of Changes in Equity

Expressed in Canadian dollars, except for the number of shares - Unaudited

    Common shares                          
    Number     Amount     Contributed
surplus
    Other
comprehensive
income (loss)
    Retained
earnings
(deficit)
    Total  
                                     
          $     $     $     $     $  
Balance, April 30, 2022   1     1     (1,289,541 )   (8,040 )   5,277     (1,292,303 )
Royalty interests (Note 5)   -     -     (14,024 )   -     -     (14,024 )
Net income and other comprehensive income for the period   -     -     -     6,136     35,511     41,647  
Balance, January 31, 2023   1     1     (1,303,565 )   (1,904 )   40,788     (1,264,680 )
                                     
Balance, April 30, 2023   1     1     (1,303,565 )   18,423     24,428     (1,260,713 )
Royalty interests (Note 5)   -     -     (13,138 )   -     -     (13,138 )
Net (loss) and other comprehensive income for the period   -     -           9,827     (96,794 )   (86,967 )
                -                    
Balance, January 31, 2024   1     1     (1,316,703 )   28,250     (72,366 )   (1,360,818 )

The accompanying notes are an integral part of these Condensed Consolidated Interim financial statements

Page | 5


VIZSLA ROYALTIES CORP.

Notes to Condensed Consolidated Interim Financial Statements
For the nine months ended January 31, 2024, and 2023
(Expressed in Canadian dollars) - Unaudited

1. Nature of Operations and Going Concern

The Company was incorporated on January 11, 2021, under the Business Corporations Act (British Columbia) under the name Vizsla Copper Corp. as a wholly owned subsidiary of Vizsla Silver Corp. ("Vizsla Silver"). The Company changed its name to 1283303 B.C. Ltd. on April 23, 2021, and then to Vizsla Royalty Corp on July 9, 2021. On October 13, 2023, Vizsla Royalty Corp.'s name was changed to Panuco Royalty Corp. Vizsla Royalties Corp. was incorporated. (the "Company", "Vizsla Royalties") on October 13, 2023, as a wholly-owned subsidiary of Vizsla Silver. Vizsla Silver transferred its ownership of Panuco Royalty Corp. to the Company and therefore Panuco Royalty Corp. became a wholly owned subsidiary of Vizsla Royalties Corp.

The Company is a royalty-focused company with initial assets comprised of net smelter royalties ("NSR") on Vizsla Silver's wholly-owned Panuco-Copala projects in Mexico.

The head office and principal address of the Company is located at Suite 1723 - 595 Burrard Street, Vancouver, BC V7X 1J1.

These condensed consolidated Interim financial statements have been prepared on a going-concern basis, which assumes that the Company will be able to realize assets and discharge liabilities in the normal course of business. The Company's ability to be a going concern depends on Vizsla Silver's financial support currently and its intention of future financing since no revenue is expected in the near future. If the going concern assumption was not used, the adjustments required to report the Company's assets and liabilities on a liquidation basis could be material to these condensed consolidated interim financial statements. Accordingly, these condensed consolidated Interim financial statements do not give effect to adjustments, if any, that would be necessary should the Company be unable to continue as a going concern.

The Company's activities for royalty generation are in an emerging nation and, consequently, may be subject to a higher level of risk compared to developed countries. Operations, the status of mineral property rights, and the recoverability of investments in emerging nations can be affected by changing economic, legal, regulatory, and political situations.

As at January 31, 2024, the Company had no revenues, had a working capital deficit of $1,360,819 (April 30, 2023 - $1,260,714), and expects to incur further losses in the development of its business, all of which indicate a material uncertainty that may cast significant doubt upon the Company's ability to continue as a going concern. The Company will require additional financing in order to meet its ongoing levels of corporate overhead and discharge its liabilities as they come due.

Page | 6


VIZSLA ROYALTIES CORP.

Notes to Condensed Consolidated Interim Financial Statements
For the nine months ended January 31, 2024, and 2023
(Expressed in Canadian dollars) - Unaudited

2. Material Accounting Policies and Basis of Presentation

These condensed consolidated interim financial statements have been prepared in accordance with International Accounting Standard ("IAS") 34, Interim Financial Reporting, as issued by the International Accounting Standards Board ("IASB"). Accordingly, certain information and footnote disclosure normally included in annual financial statements prepared in accordance with International Financial Reporting Standards ("IFRS") have been omitted or condensed, and therefore these condensed consolidated Interim financial statements should be read in conjunction with the Company's April 30, 2023, audited annual consolidated financial statements and the notes to such financial statements.

These condensed consolidated interim financial statements are based on the IFRS issued and effective as of January 31, 2024. These condensed consolidated Interim financial statements were authorized for issue by the Company's Board of Directors on May 17, 2024.

These condensed consolidated interim financial statements follow the same accounting policies and methods of computation as the most recent annual consolidated financial statements:

a) Basis of Consolidation

These condensed consolidated interim financial statements incorporate the financial statements of the Company and the subsidiaries controlled by the Company.

The principal subsidiaries of the Company, which are accounted for under the consolidation method, are as follows:

Subsidiary Principal activities Country of
incorporation
and operation
Ownership
interest as of
January 31,
2024
Ownership
interest as of
April 30,
2023
Canam Royalties Mexico, S.A. de C.V. Royalty Company Mexico 100% 100%
Panuco Royalty Corp. Royalty Company Canada 100% 100%

Subsidiaries are entities (including structured entities) over which the Company has control. The Company controls an entity when the Company is exposed to, or has rights to, variable returns from its involvement with the entity and can affect those returns through its power over the entity. Subsidiaries are fully consolidated from the date on which control is transferred to the Company. They are deconsolidated from the date that control ceases. All significant intercompany transactions and balances have been eliminated.

Page | 7


VIZSLA ROYALTIES CORP.

Notes to Condensed Consolidated Interim Financial Statements
For the nine months ended January 31, 2024, and 2023
(Expressed in Canadian dollars) - Unaudited

2. Material Accounting Policies and Basis of Presentation (continued)

b) Accounting pronouncements

Information about accounting pronouncements is disclosed in Note 3 (l) of the annual consolidated financial statements.

c) Significant Accounting Judgments and Estimates

Preparing the condensed consolidated interim financial statements in conformity with IFRS requires management to make judgments, estimates, and assumptions that affect the application of accounting policies and the reported amounts of assets, liabilities, income and expenses, and related disclosure. Estimates and assumptions are continuously evaluated and are based on management's experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances.

Judgment is used mainly in determining how a balance or transaction should be recognized in the financial statements. Estimates and assumptions are used mainly in determining the measurement of recognized transactions and balances. Actual results may differ from these estimates.

Information about critical judgments and estimates in applying accounting policies that have the most significant effect on the amounts recognized in the condensed consolidated interim financial statements for the nine months ended January 31, 2024 and 2023, are consistent with those applied and disclosed in Note 3 (m) of the annual consolidated financial statements. The Company's interim results are not necessarily indicative of its results for a full year.

3. Cash and Cash Equivalents

    January 31, 2024     April 30, 2023*  
    $     $  
Cash and cash equivalents   21,887     55,311  
Total   21,887     55,311  

*As of April 30, 2023, the cash and cash equivalents disclosed above and in the condensed consolidated interim statements of cash flows include $55,311 is cash withheld in an inactive bank account. The inactive bank account was reactivated in May 2023.

4. Taxes Receivable

    January 31, 2024     April 30, 2023  
    $     $  
Mexican VAT recoverable*   257,656     246,790  
Total   257,656     246,790  

*Taxes receivable is Mexican Value Added Tax (IVA) which relates to the purchase of royalty interest (Note 5).

Page | 8


VIZSLA ROYALTIES CORP.

Notes to Condensed Consolidated Interim Financial Statements
For the nine months ended January 31, 2024, and 2023
(Expressed in Canadian dollars) - Unaudited

5. Royalty Interests

Panuco-Copala Royalty Interests

On February 25, 2022, the Company signed two agreements to purchase a 0.5% and 2.0% net smelter return ("NSR") royalty on the Panuco-Copala properties in Mexico from Minera Canam S.A. de C.V. ("Minera Canam"), a subsidiary of Vizsla Silver and an entity under common control with the Company. The Company will pay US$100,000 (paid) for the 0.5% royalty and US$900,000 (paid) for the 2.0% royalty.

On November 16, 2022, the Company signed three agreements to purchase 2.0% NSR royalty on multiple properties in Mexico from Minera Canam. These properties are all part of the Panuco-Copala.

 The Company paid US$3,500 for the 2.0% royalty on La Cruz Negra and La Cruz Negra 2 properties.

 The Company paid US$2,000 for the 2.0% royalty on San Antonio property.

 The Company paid US$5,000 for the 2.0% royalty on Maria Chuchena property.

On July 23, 2023, the Company signed an agreement to purchase 2.0% NSR royalty on multiple properties in Mexico from Minera Canam. These properties are all part of the Panuco-Copala.

 The Company will pay US$10,000 for the 2.0% royalty on El Oregano, El Oregano 2, and Dos Compadres properties (paid on October 26, 2023).

Under IFRS, the purchase of the NSR from Minera Canam by the Company is a transaction between parties under common control and accordingly, the royalty interest is recorded at fair value which is determined to be $1 (April 30, 2023: $1).

During the nine months ended January 31, 2024, the difference between fair value and agreed consideration of $13,138 (US$10,000) (year ended April 30, 2023: $14,024 (US$10,500) is recorded as excess benefit to shareholder in equity.

6. Due to Related Party

    January 31, 2024     April 30, 2023  
    $     $  
Due to related party   1,609,312     1,546,277  
Total   1,609,312     1,546,277  

Due to related party includes amounts transferred by Vizsla Silver to the Company to purchase the royalty interests from Minera Canam and daily operation.

7. Share Capital

Authorized, Issued, and Outstanding

As of January 31, 2024, and April 30, 2023, unlimited number of common shares were authorized, and 1 common share with no par value was issued and outstanding.

Page | 9


VIZSLA ROYALTIES CORP.

Notes to Condensed Consolidated Interim Financial Statements
For the nine months ended January 31, 2024, and 2023
(Expressed in Canadian dollars) - Unaudited

8. Financial Instruments

Fair value of financial instruments

The Company applied the following fair value hierarchy which prioritizes the inputs used in the valuation methodologies in measuring fair value into three levels:

The three levels are defined as follows:

 Level 1 - inputs to the valuation methodology are quoted prices (unadjusted) for identical assets or liabilities in active markets.

 Level 2 - inputs to valuation methodology include quoted prices for similar assets and liabilities in active markets and inputs that are observable for the asset or liability, either directly or indirectly, for substantially the full term of the financial instrument.

 Level 3 - inputs to the valuation methodology are unobservable and significant to the fair value measurement.

The Company's financial instruments are cash and cash equivalent, accounts payable and accrued liabilities, and due to related party. All these financial instruments are carried on the condensed consolidated interim statements of financial position at amortized cost. The fair values of these financial instruments approximate their carrying value due to their short-term nature.

The Company's financial instruments are exposed to certain financial risks, including liquidity risk, market risk, interest rate risk, foreign currency risk, price risk, and credit risk.

Liquidity risk

Liquidity risk is the risk that the Company is unable to meet its financial obligations as they come due. The Company manages this risk by careful management of its working capital to ensure the Company's expenditure will not exceed available resources.

Market risk

Market risk is the risk that changes in market prices will affect the Company's earnings or the value of its financial instruments. Market risk is comprised of commodity price risk and interest rate risk. The objective of market risk management is to manage and control exposures within acceptable limits while maximizing returns. The Company is not exposed to significant market risk.

Page | 10


VIZSLA ROYALTIES CORP.

Notes to Condensed Consolidated Interim Financial Statements
For the nine months ended January 31, 2024, and 2023
(Expressed in Canadian dollars) - Unaudited

8. Financial Instruments (continued)

Interest rate risk

Interest rate risk is the risk that the fair value or future cash flows of financial instruments will fluctuate because of changes in market interest rates. An immaterial amount of interest rate exposure exists in respect of cash balances on the statement of financial position. As a result, the Company is not exposed to material cash flow interest rate risk on its cash balances.

Foreign currency risk

Foreign currency risk is the risk that a variation in exchange rates between the Canadian dollar, United States dollar, and Mexican Peso will affect the Company's operations and financial results. The Company and its subsidiaries are exposed to foreign currency risk to the extent that it has monetary assets and liabilities denominated in foreign currencies.

The Company measures the effect on total assets or total receipts of reasonably foreseen changes in interest rates and foreign exchange rates. The analysis is used to determine if these risks are material to the financial position of the Company. A 1% change in the foreign exchange rate of CAD to MXN and CAD to USD would increase/decrease the net income for the nine months ended January 31, 2024, by approximately $13,882 (for the nine months ended January 31, 2023: $12,586). Actual financial results for the coming year will vary since the balances of financial assets are expected to decline as funds are used for Company expenses.

Price risk

This risk relates to fluctuations in commodity and equity prices. The Company monitors commodity prices of precious and base metals, individual equity movements, and the stock market to determine the appropriate course of action to be taken by the Company. Fluctuation in pricing is not a significant risk to the Company.

Credit risk

Credit risk is the risk that a counterparty to a financial instrument will fail to discharge an obligation or commitment that it has entered with the Company. The Company is exposed to credit-related losses in the event of non-performance by the counterparties. The carrying amounts of financial assets best represent the maximum credit risk exposure at the reporting date. Cash and cash equivalents are held with reputable banks in Mexico. Therefore, management believes credit risk is low.

Page | 11


VIZSLA ROYALTIES CORP.

Notes to Condensed Consolidated Interim Financial Statements
For the nine months ended January 31, 2024, and 2023
(Expressed in Canadian dollars) - Unaudited

9. Capital Management

The Company manages its capital to safeguard the Company's ability to continue as a going concern, so that it can continue to provide adequate returns to shareholders and benefits to other stakeholders, and to have sufficient funds on hand for business opportunities as they arise. The Company manages the capital structure and makes adjustments to it in the light of changes in economic conditions and the risk characteristics of the underlying assets.

In order to maintain or adjust the capital structure, the Company depends on Vizsla Silver's financial support. Vizsla Silver may issue new shares through short-form prospectuses, private placements, sell assets, incur debt, or return capital to shareholders. There were no changes in the Company's approach to capital management during the period. In the management of capital, the Company includes the components of shareholder' equity, as well as cash. As at January 31, 2024, the Company is not subject to externally imposed capital requirements.

10. Subsequent Events

On January 17, 2024, Vizsla Silver announced its intention to enter into an arrangement agreement with the Company ("Spinco").

On February 12, 2024, Vizsla Silver announced its intention to conduct a Spinout within 45 days. This Spinout entails distributing shares of Spinco to Vizsla Silver's shareholders. Holders of the Vizsla Silver's common shares (referred to as "Vizsla Silver Shares") will receive 1/3 of a common share of Spinco and 1/3 of a common share purchase warrant of Spinco for each Vizsla Silver Share held on the share distribution record date.

After the Spinout, Vizsla Silver is expected to hold a majority of the Company's shares, without exerting controlling interest.

On March 27, 2024, the Company and Vizsla Silver has executed an arrangement agreement whereby the business of Vizsla Silver will be reorganized into two companies by way of a plan of arrangement (the "Arrangement"). Vizsla Silver shareholders will vote on the Arrangement at a special meeting of shareholders to be held on a later date. To be effective, the Arrangement must be approved by a special resolution passed by at least 2/3 of the votes cast by Vizsla Silver shareholders present in person or represented by proxy.

Page | 12


 

 

VIZSLA ROYALTIES CORP.

MANAGEMENT DISCUSSION AND ANALYSIS

FOR THE NINE MONTHS ENDED

JANUARY 31, 2024, and 2023

 

 

 

 


VIZSLA ROYALTIES CORP.

MANAGEMENT DISCUSSION AND ANALYSIS

FOR THE NINE MONTHS ENDED JANUARY 31, 2024, and 2023

BASIS OF DISCUSSION & ANALYSIS

This Management Discussion and Analysis ("MD&A") of the financial position and results of Vizsla Royalties Corp. (the "Company" or "Vizsla Royalties") was prepared by management and approved before its release.

Readers are cautioned that the MD&A contains forward-looking statements and that actual events may vary from management's expectations. Readers are encouraged to read the Forward-Looking Statement disclaimer included with this MD&A.

The consolidated financial statements and MD&A are presented in Canadian dollars, unless otherwise indicated, and have been prepared in accordance with International Financial Reporting Standards ("IFRS"). The statements and any summary of results presented in the MD&A were prepared in accordance with International Financial Reporting Standards ("IFRS") as issued by the International Accounting Standards Board ("IASB"). Please consult the audited consolidated financial statements for the years ended April 30, 2023, and 2022, and condensed consolidated interim financial statements for the nine months ended January 31, 2024, and 2023, for more complete financial information.

DATE

This MD&A has been prepared based on information available to the Company as of May 17, 2024.

OVERALL PERFORMANCE

NATURE OF OPERATIONS AND GOING CONCERN

The Company was incorporated on January 11, 2021, under the Business Corporations Act (British Columbia) under the name Vizsla Copper Corp. The Company changed its name to 1283303 B.C. Ltd. on April 23, 2021, and then to Vizsla Royalty Corp on July 9, 2021. On Oct 13, 2023, Vizsla Royalty Corp.'s name was changed to Panuco Royalty Corp., and Vizsla Royalties Corp. was incorporated. (the "Company", "Vizsla Royalties"). Panuco Royalty Corp. is a wholly-owned subsidiary of Vizsla Royalties Corp.

From the date of incorporation, the Company was a wholly owned subsidiary of Vizsla Silver Corp. ("Vizsla Silver"). The Company is a royalty-focused company with initial assets comprised of net smelter royalties ("NSR") on Vizsla Silver's wholly-owned Panuco-Copala projects in Mexico.

The head office and principal address of the Company is located at Suite 1723 - 595 Burrard Street, Vancouver, BC V7X 1J1.

The Company's activities for royalty generation are in an emerging nation and, consequently, may be subject to a higher level of risk compared to developed countries. Operations, the status of mineral property rights, and the recoverability of investments in emerging nations can be affected by changing economic, legal, regulatory, and political situations.

As at January 31, 2024, the Company had no revenues, had a working capital deficit of $1,360,819 (April 30, 2023 - $1,260,714), and expects to incur further losses in the development of its business, all of which indicate a material uncertainty that may cast significant doubt upon the Company's ability to continue as a going concern. The Company will require additional financing to conduct its planned work programs on mineral properties, meet its ongoing levels of corporate overhead, and discharge its liabilities as they come due.

2


VIZSLA ROYALTIES CORP.

MANAGEMENT DISCUSSION AND ANALYSIS

FOR THE NINE MONTHS ENDED JANUARY 31, 2024, and 2023

RESULTS OF OPERATION

For the nine months ending on January 31, 2024 ("2024"), the Company reported a net loss of $96,794, compared to a net income of $35,511 for the same period ending January 31, 2023 ("2023"). For 2024, the foreign exchange loss is $1,381 compared to a gain of $35,690 in 2023, primarily driven by the fluctuation of the Mexican peso against USD, $95,160 in professional fees (2023: $nil), and $253 of various office expenses (2023: $179).

Additionally, the Company recorded other comprehensive losses of $86,967, compared to a comprehensive gain of $41,648 reported in 2023.

SUMMARY OF QUARTERLY RESULTS

    Q3     Q2     Q1     Q4     Q3     Q2     Q1     Q4  
    January 31,     October 31,     July 31,     April 30,     January 31,     October 31,     July 31,     April 30,  
    2024     2023     2023     2023     2023     2022     2022     2022  
                                                 
Net (loss) / income $ (94,521 ) $ (3,218 ) $ 945   $ (16,360 ) $ 31,511   $ 3,699   $ 301   $ 5,278  
                                                 
(Loss) / income per common share $ (94,521 ) $ (3,218 ) $ 945   $ (16,360 ) $ 31,511   $ 3,699   $ 301   $ 5,278  
                                                 

The fluctuations in foreign exchange gain, stemming from the strengthening of the Mexican peso against the United States dollar, account for the variance observed over the eight quarters. Additionally, each quarterly net income and net loss includes minor professional fees and office expenses. In the quarter ending January 31, 2024, the Company reported a net loss of $94,521, primarily attributed to professional fees related to the spin-out of Vizsla Royalties.

LIQUIDITY

As of January 31, 2024, the Company's cash and cash equivalents were $21,887 (April 30, 2023: $55,311)

and a working deficit of $1,360,819 (April 30, 2023: $1,260,714). The working deficit is due to a related party amount owing to Vizsla Silver as Vizsla Silver transferred cash to the Company to purchase the royalty in Minera Canam and paid for transaction fees related to the spin-out of Vizsla Royalties.

During the nine months ended January 31, 2024 ("2024"), $91,767 was used in operating activities compared to $22,775 used during the nine months ended January 31, 2023 ("2023"). $13,138 was used in investing activities in 2024 compared to $1,514,261 in 2023. $63,035 was generated from investing activities in 2024 compared to $1,544,970 in 2023.

The Company has no long-term debt or commitments.

As the Company has no revenues, its ability to fund operations is dependent upon its parent company, Vizsla Silver. See Section "Risk Factors", below.

CAPITAL RESOURCES

The Company had 1 issued and outstanding common shares as of January 31, 2024 (April 30, 2023 - 1).

3


VIZSLA ROYALTIES CORP.

MANAGEMENT DISCUSSION AND ANALYSIS

FOR THE NINE MONTHS ENDED JANUARY 31, 2024, and 2023

OFF-BALANCE SHEET ARRANGEMENTS

As a policy, the Company does not enter into off-balance sheet arrangements with special-purpose entities in the normal course of business, nor does it have any unconsolidated affiliates.

TRANSACTIONS WITH RELATED PARTIES

As of January 31, 2024, the amount due to the related party includes $1,609,312 (April 30, 2023: $1,546,277) transferred by Vizsla Silver to the Company to purchase the royalty interests from Minera Canam. and paid for transaction fees related to the spin-out of Vizsla Royalties.

PROPOSED TRANSACTIONS

There are no proposed transactions as of the date of this MD&A.

CRITICAL ACCOUNTING ESTIMATES

The preparation of the consolidated financial statements in conformity with IFRS requires management to make judgments, estimates, and assumptions that affect the application of accounting policies and the reported amounts of assets, liabilities, income and expenses, and related disclosure. Estimates and assumptions are continuously evaluated and are based on management's experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances.

Judgment is used mainly in determining how a balance or transaction should be recognized in the financial statements. Estimates and assumptions are used mainly in determining the measurement of recognized transactions and balances. Actual results may differ from these estimates.

Tax receivables

Value-added tax ("VAT") receivable is collectible from the government of Mexico. The collection of VAT is subject to risk due to the complex application and collection process and therefore, risk related to the collectability and timing of payment from the Mexican government. The Company uses its best estimates based on the facts known at the time and its experience to determine its best estimate of the collectability and timing of these recoveries. Changes in the assumptions regarding collectability and the timing of collection could impact the valuation and classification of VAT receivable.

Income Taxes

Income tax expense comprises current and deferred tax. Income tax is recognized in the statement of loss and comprehensive loss except to the extent it relates to items recognized directly in equity.

Current tax expense is the expected tax payable on the taxable income for the year, using tax rates enacted or substantively enacted at year-end, adjusted for amendments to tax payable with regard to previous years.

Deferred tax is recognized using the liability method, providing for temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for taxation purposes. Deferred tax is not recognized on the initial recognition of assets or liabilities in a transaction that is not a business combination and, at the time of the transaction, affects neither accounting profit nor taxable profit (tax loss). In addition, deferred tax is not recognized for taxable temporary differences arising on the initial recognition of goodwill. Deferred tax is measured at the tax rates that are expected to be applied to temporary differences when they reverse, based on the laws that have been enacted or substantively enacted by the reporting date. Deferred tax assets and liabilities are offset if there is a legally enforceable right to offset, and they relate to income taxes levied by the same tax authority on the same taxable entity, or on different tax entities, but they intend to settle current tax liabilities and assets on a net basis, or their tax assets and liabilities will be realized simultaneously.

A deferred tax asset is recognized to the extent that it is probable that future taxable profits will be available against which the temporary difference can be utilized. Deferred tax assets are reviewed at each reporting date and are reduced to the extent that it is no longer probable that the related tax benefit will be realized.

4


VIZSLA ROYALTIES CORP.

MANAGEMENT DISCUSSION AND ANALYSIS

FOR THE NINE MONTHS ENDED JANUARY 31, 2024, and 2023

CRITICAL ACCOUNTING ESTIMATES (Continued)

Going concern evaluation

As discussed in note 1 to the consolidated financial statements, the financial statements have been prepared under the assumptions applicable to a going concern. If the going concern assumption were not appropriate for the financial statements, then adjustments would be necessary to the carrying value of assets and liabilities, the reported expenses, and the statement of financial position classifications used, and such adjustments could be material.

The Company reviews the going concern assessment at the end of each reporting period. There were no material changes to the assessment as of January 31, 2024.

CHANGES IN ACCOUNTING POLICIES INCLUDING INITIAL ADOPTION

There has been no adoption or recognition of accounting policies other than that are disclosed in note 3 to the annual audited consolidated financial statements for the years ended April 30, 2023, and 2022.

FINANCIAL INSTRUMENTS AND OTHER INSTRUMENTS

The Company's activities expose it to a variety of financial risks, which include market risk, foreign currency risk, interest rate risk, price risk, credit risk, and liquidity risk. The Company's risk management program focuses on the unpredictability of financial markets and seeks to minimize potential adverse effects on the Company's financial performance.

Market risk

Market risk is the risk that changes in market prices will affect the Company's earnings or the value of its financial instruments. Market risk is comprised of commodity price risk and interest rate risk. The objective of market risk management is to manage and control exposures within acceptable limits while maximizing returns. The Company is not exposed to significant market risk.

Interest rate risk

Interest rate risk is the risk of losses that arise because of changes in contracted interest rates. The Company is not exposed to significant interest rate risk.

Foreign currency risk

The Company incurs certain expenses in currencies other than the functional currency. The Company is subject to foreign exchange risk because of fluctuations in exchange rates. The Company manages this risk by maintaining bank accounts in US dollars and Mexican pesos to pay foreign currency expenses as they arise. Receipts in foreign currencies are maintained in those currencies. The Company does not undertake currency hedging activities. The Company also does not attempt to hedge the net investment and equity of integrated foreign operations.

The Company measures the effect on total assets or total receipts of reasonably foreseen changes in interest rates and foreign exchange rates. The analysis is used to determine if these risks are material to the financial position of the Company. A 1% change in the foreign exchange rate of CAD to MXN and CAD to USD would increase/decrease the net and comprehensive income for the nine months ended January 31, 2024, by approximately $13,882 (April 30, 2023: $13,273). Actual financial results for the coming year will vary since the balances of financial assets are expected to decline as funds are used for Company expenses.

Price risk

This risk relates to fluctuations in commodity and equity prices. The Company closely monitors commodity prices of precious and base metals, individual equity movements, and the stock market to determine the appropriate course of action to be taken by the Company. Fluctuations in pricing may be significant.

5


VIZSLA ROYALTIES CORP.

MANAGEMENT DISCUSSION AND ANALYSIS

FOR THE NINE MONTHS ENDED JANUARY 31, 2024, and 2023

FINANCIAL INSTRUMENTS AND OTHER INSTRUMENTS (Continued)

Credit risk

Credit risk is the risk of an unexpected loss if a counterparty or third party to a financial instrument fails to meet its contractual obligations. To reduce credit risk, cash and cash equivalents are on deposit at major financial institutions. The Company is not aware of any counterparty risk that could have an impact on the fair value of the cash and cash equivalents.

The carrying value of the financial assets represents the maximum credit exposure. The Company minimizes credit risk by reviewing the credit risk of the counterparties to its arrangements prior to entering into such agreements.

Liquidity risk

Liquidity risk is the risk that the Company will not be able to meet its financial obligations as they fall due. The Company has a planning and budgeting process in place to help determine the funds required to support the Company's normal operating requirements on an ongoing basis, including exploration plans. The Company attempts to ensure that there are sufficient funds to meet its short-term business requirements, considering its anticipated cash flows from operations and holdings of cash and cash equivalents.

OTHER REQUIREMENTS

Risks Factors and Uncertainties

Overview

The Company is focused on gaining exposure to commodity prices by making strategic investments in mining interests, including royalties, streams, debt and equity investments in mining companies. Resource exploration and development is a speculative business, characterized by a number of significant risks including, among other things, unprofitable efforts resulting not only from the failure to discover mineral deposits but also from finding mineral deposits, which, though present, are insufficient in quantity and quality to return a profit from production. The marketability of minerals acquired or discovered may be affected by numerous factors that are beyond the control of the Company and which cannot be accurately predicted, such as market fluctuations of metal prices, the proximity and capacity of milling facilities, mineral markets, processing reagents and equipment, and such other factors as government regulations, including regulations relating to royalties, allowable production, importing and exporting of minerals, and environment protection, the combination of which factors may result in the Company not receiving an adequate return on investment.

Competition

Other exploration companies, including those with greater financial resources than the Company, could adopt or may have adopted the same business strategies and thereby compete directly with the Company, or may seek to acquire and develop mineral claims in areas targeted by the Company. While the risk of direct competition may be mitigated by the Company's experience and technical capabilities, there can be no assurance that competition will not increase or that the Company will be able to compete successfully.

6


VIZSLA ROYALTIES CORP.

MANAGEMENT DISCUSSION AND ANALYSIS

FOR THE NINE MONTHS ENDED JANUARY 31, 2024, and 2023

OTHER REQUIREMENTS (Continued)

Risks Factors and Uncertainties (Continued)

Foreign Operations and Political Risk

The Company's mineral properties are in Canada, Mexico, and the United States. In foreign jurisdictions, mineral exploration and mining activities may be affected in varying degrees by political or economic instability, expropriation of property, and changes in government regulations such as tax laws, business laws, environmental laws, and mining laws. Any changes in regulations or shifts in political conditions are beyond the control of the Company and may materially adversely affect its business, or if significant enough, may make it impossible to continue to operate in certain countries. Operations may be affected in varying degrees by government regulations concerning restrictions on production, price controls, foreign exchange restrictions, export controls, income taxes, expropriation of property, environmental legislation, and exploration health and safety. These risks are not unique to foreign jurisdictions and apply equally to the property interest in Canada.

Uninsured or Uninsurable Risks

The Company may become subject to liability for pollution or hazards against which it cannot insure or against which it may elect not to insure where premium costs are disproportionate to the Company's evaluation of the relevant risks. The payment of such insurance premiums and of such liabilities would reduce the funds available for exploration and operating activities.

Commodity Prices

The prices of gold, silver, copper, lead, zinc, moly, and other minerals have fluctuated widely in recent years and are affected by several factors beyond the Company's control, including international economic and political conditions, expectations of inflation, international currency exchange rates, interest rates, consumption patterns, and speculative activities and increased production due to improved exploration and production methods. Fluctuations in commodity prices will influence the willingness of investors to fund mining and exploration companies and the willingness of companies to participate in joint ventures with the Company and the level of their financial commitment. The supply of commodities is affected by various factors, including political events, economic conditions, and production costs in major producing regions. There can be no assurance that the price of any commodities will be such that any of the properties in which the Company has, or has the right to acquire, an interest may be mined at a profit.

Increased Costs

Management anticipates that costs at the Company's projects will frequently be subject to variation from one year to the next due to several factors, such as the results of ongoing exploration activities (positive or negative), changes in mineralisation encountered, and revisions to exploration programs, if any, in response to the foregoing. Increases in the prices of such commodities or a scarcity of consultants or drilling contractors could render the costs of exploration programs to increase significantly over those budgeted. A material increase in costs for any significant exploration programs could have a significant effect on the Company's operating funds and ability to continue its planned exploration programs.

Conflicts of Interest

Certain directors and officers of the Company also serve as directors, officers and advisors of other companies involved in natural resource exploration and development. To the extent that such companies may participate in ventures with the Company, such directors and officers may have conflicts of interest in negotiating and concluding the terms of such ventures. Such other companies may also compete with the Company for the acquisition of mineral property rights. In the event that any such conflict of interest arises, the Company's policy is that such director or officer will disclose the conflict to the board of directors and, if the conflict involves a director, such director will abstain from voting on the matter. In accordance with the Business Corporations Act (BC), the directors and officers of the Company are required to act honestly and in good faith with a view to the best interests of the Company.

7


VIZSLA ROYALTIES CORP.

MANAGEMENT DISCUSSION AND ANALYSIS

FOR THE NINE MONTHS ENDED JANUARY 31, 2024, and 2023

OTHER REQUIREMENTS (Continued)

Risks Factors and Uncertainties (Continued)

Dependence Upon Others and Key Personnel

The success of the Company's operations will depend upon numerous factors including its ability to attract and retain additional key personnel in exploration, marketing, joint venture operations, and finance. This will require the use of outside suppliers as well as the talents and efforts of the Company and its consultants and employees. There can be no assurance that the Company will be successful in finding and retaining the necessary employees, personnel, and/or consultants to be able to successfully carry out such activities. This is especially true as the competition for qualified geological, technical personnel and consultants can be particularly intense.

Government Regulation

The Company operates in an industry that is governed by numerous regulations, including but not limited to, environmental regulations as well as occupational health and safety regulations. Most of the Company's mineral properties are subject to government reporting regulations. The Company believes that it is in full compliance with all regulations and requirements related to mineral property interest claims. However, it is possible that regulations or tenure requirements could be changed by the respective governments resulting in additional costs or barriers to the development of the properties. This would adversely affect the value of properties and the Company's ability to hold onto them without incurring significant additional costs. It is also possible that the Company could violate of, or non-compliant with, regulations it is not aware of.

On April 21, 2023, the Mexican parliament's lower house voted to approve significant changes to the country's mining laws to avoid overexploitation of natural resources (the "Proposed Mining Law Amendments"). It is uncertain whether the Proposed Mining Law Amendments will be enacted in the form approved by the lower house of parliament or at all. This MD&A does not take into account the Proposed Mining Law Amendments.

Internal Control Over Financial Reporting

Management is responsible for establishing and maintaining adequate internal control over financial reporting and disclosure controls and procedures. Due to its inherent limitations, internal control over financial reporting and disclosure may not prevent or detect all misstatements. Further, the effectiveness of internal control is subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with policies and procedures may change. There were no changes in our internal controls over financial reporting during the year period ended January 31, 2024, that have materially affected, or are reasonably likely to materially affect, our internal controls over financial reporting.

Under the supervision and with the participation of management, including the Chief Executive Officer and Chief Financial Officer, management will continue to monitor and evaluate the design and effectiveness of its internal control over financial reporting and disclosure controls and procedures and may make modifications from time to time as considered necessary.

ADDITIONAL DISCLOSURE FOR ISSUERS WITHOUT SIGNIFICANT REVENUE

The condensed consolidated interim financial statements present the significant components of general and administrative expenditures. Significant components of mineral property expenditures are included in Section Results of Operations.

8


VIZSLA ROYALTIES CORP.

MANAGEMENT DISCUSSION AND ANALYSIS

FOR THE NINE MONTHS ENDED JANUARY 31, 2024, and 2023

Outstanding Share Data

The Company's authorized share capital consists of an unlimited number of common shares without par value. As of the date of this MD&A, the Company had 1 issued and outstanding common shares. Details of issued share capital are included in Note 7 of the condensed consolidated interim financial statements for the nine months ended January 31, 2024.

OTHER INFORMATION

All technical reports on material properties, press releases, and material change reports for Vizsla Silver Corp. are filed on SEDAR+ at www.sedarplus.ca.

CAPITAL MANAGEMENT

The Company manages its capital to safeguard the Company's ability to continue as a going concern so that it can continue to provide adequate returns to shareholders and benefits to other stakeholders, and to have sufficient funds on hand for business opportunities as they arise. The Company manages the capital structure and makes adjustments to it in light of changes in economic conditions and the risk characteristics of the underlying assets.

To maintain or adjust the capital structure, the Company may request capital injection from Vizsla Silver. There were no changes in the Company's approach to capital management during the period ended January 31, 2024. In the management of capital, the Company includes the components of shareholders' equity, as well as cash. As at January 31, 2024, the Company is not subject to externally imposed capital requirements.

FORWARD-LOOKING STATEMENTS

Certain information, estimates and projections contained herein, and the documents incorporated by reference herein, if any, constitute forward-looking statements regarding the Company, its operations, and projects, including, but not limited to, the Panuco-Copala Property (as defined herein). All statements that are not historical facts, involving without limitation, statements regarding future projections, plans and objectives, securing strategic partners and financing requirements and the ability to fund future mine development are forward-looking statements, or forward-looking information. Forward-looking information and statements involve risks and uncertainties that could cause actual results and future events to differ materially from those anticipated in such information or statements. Such risk factors and uncertainties include, but are in no way limited to, statements with respect to the effect and estimated timeline of the drilling and assay results of the Company, the estimation of mineral reserves and mineral resources, the timing and amount of estimated future exploration, costs of exploration, capital expenditures, success of exploration activities, permitting time lines and permitting, government regulation of mining operations, environmental risks, unanticipated reclamation expenses, title disputes or claims, fluctuations in mineral prices, uncertainties and other factors relating to public health crises, including the evolving COVID-19 coronavirus ("COVID-19"), volatility in the global financial markets, increased inflation, and turbulence in mining markets resulting from the invasion of Ukraine by Russia, and other risk factors, as discussed in the Company's filings with Canadian securities regulatory agencies including the documents incorporated by reference herein.

Generally, forward-looking information can be identified by the use of forward-looking terminology such as "plans", "expects" or "does not expect", "is expected", "budget", "scheduled", "estimates", "forecasts", "intends", "anticipates" or "does not anticipate", or "believes", or variations of such words and phrases or statements that certain actions, events or results "may", "could", "would", "might" or "will be taken", "occur" or "be achieved". Forward-looking statements are based on the opinions and estimates of management as of the date such statements are made and they are subject to known and unknown risks, uncertainties and other factors that may cause the actual results, level of activity, performance or achievements of the Company to be materially different from those expressed or implied by such forward-looking statements or forward-looking information. Although management of the Company has attempted to identify important factors that could cause actual results to differ materially from those contained in forward-looking statements or forward-looking information, there may be other factors that cause results not to be as anticipated, estimated or intended.

There can be no assurance that such statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Accordingly, readers should not place undue reliance on forward-looking statements and forward-looking information. The Company disclaims any obligation to update any forward-looking statements or information, other than as may be specifically required by applicable securities laws and regulations.

9


 

 

 

VIZSLA ROYALTIES CORP.

Consolidated Financial Statements

(Expressed in Canadian Dollars)

For the years ended April 30, 2023, and 2022

 

 

 

 




Independent Auditor's Report

To the Shareholder of Vizsla Royalties Corp.:

Opinion

We have audited the consolidated financial statements of Vizsla Royalties Corp. and its subsidiaries (the "Company"), which comprise the consolidated statements of financial position as at April 30, 2023 and April 30, 2022, and the consolidated statements of income and other comprehensive income (loss), changes in equity and cash flows for the years then ended, and notes to the consolidated financial statements, including a summary of significant accounting policies.

In our opinion, the accompanying consolidated financial statements present fairly, in all material respects, the consolidated financial position of the Company as at April 30, 2023 and April 30, 2022, and its consolidated financial performance and its consolidated cash flows for the years then ended in accordance with International Financial Reporting Standards.

Basis for Opinion

We conducted our audits in accordance with Canadian generally accepted auditing standards. Our responsibilities under those standards are further described in the Auditor's Responsibilities for the Audit of the Consolidated Financial Statements section of our report. We are independent of the Company in accordance with the ethical requirements that are relevant to our audits of the consolidated financial statements in Canada, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Material Uncertainty Related to Going Concern

We draw attention to Note 1 in the consolidated financial statements, which indicates that the Company had a working capital deficiency. As stated in Note 1, these events or conditions, along with other matters as set forth in Note 1, indicate that a material uncertainty exists that may cast significant doubt on the Company's ability to continue as a going concern. Our opinion is not modified in respect of this matter.

Other Information

Management is responsible for the other information. The other information comprises Management's Discussion and Analysis.

Our opinion on the consolidated financial statements does not cover the other information and we do not express any form of assurance conclusion thereon.

In connection with our audits of the consolidated financial statements, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the consolidated financial statements or our knowledge obtained in the audits or otherwise appears to be materially misstated. We obtained Management's Discussion and Analysis prior to the date of this auditor's report. If, based on the work we have performed on this other information, we conclude that there is a material misstatement of this other information, we are required to report that fact. We have nothing to report in this regard.

MNP LLP  

2200 - 1021 West Hastings Street, Vancouver BC, V6E 0C3

1.877.688.8408 T: 604.685.8408 F: 604.685.8594

  MNP.ca


Responsibilities of Management and Those Charged with Governance for the Consolidated Financial Statements

Management is responsible for the preparation and fair presentation of the consolidated financial statements in accordance with International Financial Reporting Standards, and for such internal control as management determines is necessary to enable the preparation of consolidated financial statements that are free from material misstatement, whether due to fraud or error.

In preparing the consolidated financial statements, management is responsible for assessing the Company's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless management either intends to liquidate the Company or to cease operations, or has no realistic alternative but to do so.

Those charged with governance are responsible for overseeing the Company's financial reporting process.

Auditor's Responsibilities for the Audit of the Consolidated Financial Statements

Our objectives are to obtain reasonable assurance about whether the consolidated financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor's report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with Canadian generally accepted auditing standards will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these consolidated financial statements.

As part of an audit in accordance with Canadian generally accepted auditing standards, we exercise professional judgment and maintain professional skepticism throughout the audit. We also:

 Identify and assess the risks of material misstatement of the consolidated financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.

 Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company's internal control.

 Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by management.

 Conclude on the appropriateness of management's use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Company's ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor's report to the related disclosures in the consolidated financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor's report. However, future events or conditions may cause the Company to cease to continue as a going concern.

 Evaluate the overall presentation, structure and content of the consolidated financial statements, including the disclosures, and whether the consolidated financial statements represent the underlying transactions and events in a manner that achieves fair presentation.

 Obtain sufficient appropriate audit evidence regarding the financial information of the entities or business activities within the Company to express an opinion on the consolidated financial statements. We are responsible for the direction, supervision and performance of the group audit. We remain solely responsible for our audit opinion.



We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audits and significant audit findings, including any significant deficiencies in internal control that we identify during our audits.

We also provide those charged with governance with a statement that we have complied with relevant ethical requirements regarding independence, and to communicate with them all relationships and other matters that may reasonably be thought to bear on our independence, and where applicable, related safeguards. 

 

Vancouver, British Columbia

 

   

May 17, 2024

Chartered Professional Accountants



VIZSLA ROYALTIES CORP.

Consolidated Statements of Financial Position

Expressed in Canadian dollars

As at Note   April 30, 2023     April 30, 2022  
      $     $  
ASSETS              
Current assets              
       Cash and cash equivalents 4   55,311     2,479  
       Taxes receivable 5   246,790     206,761  
Total current assets     302,101     209,240  
               
Non-current assets              
       Royalty interests 6   1     1  
Total non-current assets     1     1  
Total assets     302,102     209,241  
               
               
LIABILITIES              
Current liabilities              
       Accounts payable and accrued liabilities     16,538     1,500,237  
       Due to related party 7   1,546,277     1,307  
Total current liabilities     1,562,815     1,501,544  
SHAREHOLDER'S DEFICIT              
       Share capital     1     1  
       Excess benefit to shareholder 6   (1,303,565 )   (1,289,541 )
       Accumulated other comprehensive income/ (loss)     18,423     (8,040 )
       Retained earnings     24,428     5,277  
Total shareholder's deficit     (1,260,713 )   (1,292,303 )
Total liabilities and shareholder's deficit     302,102     209,241  

Note 1 - Nature of Operation and Going Concern

Note 12 - Subsequent Events

They are signed on the Company's behalf by:

"Michael Konnert"

Director

The accompanying notes are an integral part of these consolidated financial statements

Page | 2


VIZSLA ROYALTIES CORP.

Consolidated Statements of Income and Comprehensive Income (Loss)

Expressed in Canadian dollars

For the years ended   April 30, 2023     April 30, 2022  
    $     $  
General and administrative expenses            
Foreign exchange gain   (21,081 )   (5,302 )
Legal fee   1,890     -  
Office and miscellaneous   40     24  
Net income   19,151     5,278  
Other comprehensive income / (loss)            
Items that will be reclassified to profit and loss subsequently            
Translation gain (loss) on foreign operations   26,463     (8,040 )
Comprehensive income / (loss)   45,614     (2,762 )
Basic and diluted income per share   19,151     5,278  
             
Weighted average number of common shares            
             
Basic and diluted   1     1  

The accompanying notes are an integral part of these consolidated financial statements

Page | 3


VIZSLA ROYALTIES CORP.
Consolidated Statements of Cash Flows
Expressed in Canadian dollars

For the years ended Note   April 30, 2023     April 30, 2022  
      $     $  
Operating activities              
Net income for the year     19,151     5,278  
Items not affecting cash:              
Foreign exchange gain     (21,081 )   (5,302 )
               
Changes in non-cash working capital items:              
Accounts payable and accrued liabilities     40,029     208,018  
Taxes receivable 5   (40,029 )   (206,761 )
               
Net cash flows (used in) / provided by operating activities     (1,930 )   1,233  
               
Investing activities              
Purchase of royalty interests 6   (1,542,452 )   -  
               
Net cash flows used in investing activities     (1,542,452 )   -  
               
Financing activities              
Due to related party 7   1,595,640     1,307  
               
Net cash flows provided by financing activities     1,595,640     1,307  
               
Effects of foreign exchange     1,574     (61 )
               
Increase in cash and cash equivalents     51,258     2,540  
               
Cash and cash equivalents, beginning of year     2,479     -  
               
Cash and cash equivalents, end of year     55,311     2,479  

The accompanying notes are an integral part of these consolidated financial statements

Page | 4


VIZSLA ROYALTIES CORP.

Consolidated Statements of Changes in Equity

Expressed in Canadian dollars, except for the number of shares

    Common shares                          
                      Other              
                Excess     comprehensive     Retained     Total  
    Number     Amount     benefit to     income (loss)     Earnings  
                shareholder                    
          $     $     $     $     $  
Balance, April 30, 2021   1     1     -     -     (1 )   -  
                                     
Royalty interests (Note 6)   -     -     (1,289,541 )   -     -     (1,289,541 )
Net loss and other comprehensive loss for the year   -     -     -     (8,040 )   5,278     (2,762 )
Balance, April 30, 2022   1     1     (1,289,541 )   (8,040 )   5,277     (1,292,303 )
                                     
Royalty interests (Note 6)   -     -     (14,024 )   -     -     (14,024 )
                                     
Net income and other comprehensive income for the year   -     -     -     26,463