Defiance Acquires Option on Pan American Silver's Lucita Property; Significantly Expands Zacatecas Projects

Vancouver, British Columbia--(Newsfile Corp. - December 2, 2020) - Defiance Silver Corp. (TSXV:DEF) (OTC: DNCVF) ("Defiance" or the "Company") is pleased to announce that it has entered into a definitive option agreement with Pan American Silver Corp. ("Pan American") to acquire a 100% interest in Pan American's Lucita property, located adjacent to Defiance's San Acacio project (Figure 1). If the option requirements are satisfied and the option is exercised by the Company, this acquisition would nearly triple the land position of Defiance in the historic Zacatecas silver district to over 4,300 Ha and contains some of the most prospective targets in the camp.

Highlights of the Acquisition Include:

• Defiance's Zacatecas District landholding interests increased from 1,600 Ha to over 4,300 Ha, including more than 10 known veins that returned drill results including 3.25m of 325 g/t Ag and 1.25m of 775 g/t Ag (Figure 1).
• Acquired the on-strike extension of Zacatecas Silver Corporation's 19 million ounce Ag-Equivalent Panuco Deposit (see full disclosure below).
• Lucita hosts the undrilled Palenque vein structure, a 12 metre wide structure that has a 4km strike length and has return historical in situ grab and dump samples ranging from 25g/t Ag to over 700g/t Ag (Figure 2).
• Other priority high-grade vein structures also exist on the southern license area.

Chris Wright, Executive Chairman & CEO, commented: "Our exploration team has continued to advance our district exploration model, as it has yielded favorable targets throughout the Zacatecas Camp. The Lucita option represents a key milestone for Defiance Silver in establishing a district-scale land package at our Zacatecas projects and furthering our exploration thesis and strategy in the district. Not only does this project contain historical high-grade drill results with demonstrable exploration targets at depth and on-strike, it also has discovery potential at the multi-kilometre long Palenque structure."

Figure 1 - Defiance's Zacatecas District Land Position

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Property Overview

The 2,674 Ha Lucita project is characterized as a low to intermediate sulphidation Ag-Au vein, breccia and stockwork system with historical high-grade drill results and drill ready exploration targets. There are at least 10 known mineralized structures over a strike length of more than 4km, including the on-strike extension of the Panuco Deposit, currently being explored by Zacatecas Silver Corp. The veins in the northern license area have a continuous length of 4km and have widths from 0.20 m to 4 m. Historical drilling of these veins from 20 holes completed by Pan American in 2011-2012 returned encouraging results, including 3.35m of 325 g/t Ag from hole LU11-16 and 1.25m of 775 g/t Ag from hole LU11-9 (Figure 3). The composition of the epithermal veins at Lucita is quartz, calcite and occasionally minor barite, where colloform and crustiform banded textures can be seen, belonging to various mineralization events. The company believes the previously drilled structures intersected high-level epithermal mineralization, as mineral zonation at surface suggests that the top of the hydrothermal system is still present at the on-strike Panuco deposit.

Pan American Silver has carried out geological mapping, sampling, and two drilling campaigns in the northern license area (Figure 3). Phase I drilling in 1996 comprised 10 holes and 1,409.85 metres of drilling. Phase II drilling was carried out in late 2011 and early 2012, comprising 20 drill holes with 3,693.41 metres drilled. Both drill campaigns intersected mineralized veining typical of a high-level epithermal system.

Central and Southern License Areas (Palenque)

A key undrilled structure located on these licenses, adjacent to portion of the Defiance licenses that host the Tahures Vein, is the Palenque vein system. The Palenque system has an alteration zone up to 12 m wide at surface and numerous, high-grade rock chip, grab, and dump samples over a 4km strike length with historical chip, grab, and dump samples ranging from 25g/t Ag to >700 g/t Ag (Figure 2). The structure is characterized by high-level alteration assemblages that may be related to deeper "boiling zone" epithermal mineralization. The Palenque vein is a near-term drill target, and Defiance will be actively advancing the understanding of the mineral system in order to drill Palenque in 2021.

Figure 2 - Central Area with rock samples taken from Palenque and other unnamed structures. Recently acquired licenses in Blue and current Defiance Licenses in White. Third-party licenses are in Grey.

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Northern Licenses (Panuco/Los Tajos)

The northern claim block hosts the on-strike extension, most specifically the Panuco Central and the Tres Cruces veins, of the Panuco deposit under option to Zacatecas Silver Corp. Using a cut-off value of 100.0 g/t AgEq for the Panuco deposit, the current Inferred mineral resource estimate results in 3,954,729 tonnes grading 136.00 g/t Ag, 0.14 g/t Au, 0.012% Pb and 0.110% Zn or 153.20 g/t AgEq. This equates to 19,472,901 ounces of AgEq (2016 Mineral Resource Estimate, Panuco Deposit, Zacatecas Mexico for SantaCruz Silver Mining by V. Bui and G. Giroux). Defiance Silver's qualified person and technical team have been unable to verify this information, and that the information is not necessarily indicative of the mineralization on the Lucita property.

Figure 3 - Historical Drilling in Northern (Panuco) Area

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Table 1 - 2011-2012 historical results at the Northern (Panuco) License

Exploration Strategy

Defiance is planning an aggressive exploration program to adequately test the mineral potential at Lucita. The upcoming exploration program is being planned as detailed surface mapping, surface geochemistry, surface geophysics (Mag, IP, CSAMT), and surface drilling. The company anticipates starting this exploration program immediately and in conjunction with the ongoing surface and underground exploration programs at San Acacio and Lagartos.

Terms of Agreement

Defiance has the option to acquire 100% ownership of the Lucita Property, while Pan American Silver will retain a 2% NSR. The option terms include an initial payment of US$100,000 upon signing; US$100,000 on or before the first year anniversary; US$500,000 on or before the second year anniversary; and a final payment of US$800,000 on or before the third year anniversary.

About Defiance Silver Corp.

Defiance Silver Corp. (TSXV: DEF) (OTC: DNCVF) (FSE: D4E) is an exploration company advancing the district-scale San Acacio Deposit, located in the historic Zacatecas Silver District and the 100% owned Tepal Gold/Copper Project in Michoacán state, Mexico. Defiance is managed by a team of proven mine developers with a track record of exploring, advancing and developing several operating mines and advanced resource projects Defiance's corporate mandate is to expand the San Acacio and Tepal projects to become premier Mexican silver and gold deposits.

Mr. George Cavey, P.Geo, is a Qualified Person within the meaning of National Instrument 43-101, and has approved the technical information concerning the Company's material mineral properties contained in this press release.

On behalf of Defiance Silver Corp.

"Chris Wright"

Chairman of the Board

For more information, please contact: Investor Relations at +1 (604) 343-4677 or via email at info@defiancesilver.com.

www.defiancesilver.com

Suite 2900-550 Burrard Street

Vancouver, BC V6C 0A3

Canada

Tel: +1 (604) 343-4677 Email: info@defiancesilver.com

Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

This news release may contain forward-looking statements including but not limited to comments regarding timing and content of upcoming work programs, geological interpretations, receipt of property titles, potential mineral recovery processes, etc. Forward-looking statements address future events and conditions and therefore involve inherent risks and uncertainties. Actual results may differ materially from those currently anticipated in such statements. Defiance Silver Corp. relies upon litigation protection for forward-looking statements.

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