Suite 1800 – 925 West Georgia Street

Vancouver, British Columbia V6C 3L2

Executive Officer

The following executive officer of First Majestic is knowledgeable about the Arrangement (as defined below) and this report:

Raymond L. Polman

Chief Financial Officer

Telephone: (604) 688-3033

Details of Acquisition

Nature of Business Acquired

Pursuant to a Plan of Arrangement under Part 5 of Division 9 of the Business Corporations Act (British Columbia) (the "Arrangement"), First Majestic acquired all of the issued and outstanding common shares of Primero Mining Corp. ("Primero"), a Canadian precious metals producer headquartered in Toronto, Ontario. Primero's flagship property is the 100%-owned San Dimas silver and gold mine, located in Durango, Mexico.

In connection with the Arrangement, the existing silver purchase agreement between Primero and Wheaton Precious Metals Corp. ("WPM") relating to the San Dimas mine was terminated and the parties entered into a new precious metals purchase agreement.

First Majestic concurrently entered into an amended and restated credit agreement with the Bank of Nova Scotia, Bank of Montreal and Investec Bank PLC, as lenders, pursuant to which the lenders agreed, among other things, to provide First Majestic with a US$75 million secured revolving term credit facility (the "New Credit Facility"). The New Credit Facility replaced the prior credit facility of Primero and First Majestic's existing credit agreement with the Bank of Nova Scotia and Investec Bank PLC, as lenders.

Acquisition Date

May 10, 2018

Consideration

First Majestic issued to former Primero shareholders an aggregate of 6,418,594 common shares of First Majestic, representing 0.03325 First Majestic common shares for each Primero common share held immediately prior to the effective date of the Arrangement. Options of Primero were exchanged for replacement options of First Majestic at the same exchange ratio as the common shares.

In connection with the Arrangement, holders of Primero's $75 million 2020 convertible debentures (the "Debentures") approved an amendment to the terms of their governing indenture pursuant to which the Debentures matured and were repaid in full on May 11, 2018.

As part of the termination of the existing silver purchase agreement with WPM, First Majestic issued 20,914,590 common shares of First Majestic to Wheaton Precious Metals International Ltd., a subsidiary of WPM.

Effect on Financial Position

First Majestic intends to continue to operate Primero's San Dimas mine. First Majestic intends to conduct an internal reorganization with respect to the acquired business, but does not currently have any plans or proposals for material changes in its business affairs or the affairs of the acquired business which would have a significant effect on the financial performance and financial position of First Majestic.

Prior Valuations

There have been no prior valuation opinions obtained within the last 12 months by Primero or First Majestic to support the consideration paid.

Parties to Transaction

None of the transactions referred to herein were with an informed person, associate or affiliate of First Majestic.

Date of Report

June 15, 2018

Pursuant to Part 8 of National Instrument 51-102, the unaudited pro forma consolidated financial statements of First Majestic as at and for the three month period ended March 31, 2018 and for the year ended December 31, 2017 are attached as Schedule "A".

The unaudited condensed interim financial statements of Primero for the period ended March 31, 2018 were filed on SEDAR on May 9, 2018 and are incorporated herein by reference. These financial statements consist of the condensed consolidated interim statements of financial position of Primero as at March 31, 2018 and December 31, 2017, the condensed consolidated interim statements of operations and comprehensive income (loss), condensed consolidated interim statements of cash flows and condensed consolidated interim states of changes in equity for the three months ended March 31, 2018 and March 31, 2017, and the related notes.

The audited consolidated financial statements of Primero as at December 31, 2017 and 2016 and for the years then ended were filed on SEDAR on March 20, 2018 and are incorporated herein by reference. These financial statements and the unaudited interim financial statements of Primero can be viewed on Primero's SEDAR profile at www.sedar.com .

First Majestic did not obtain the consent of the auditors for the inclusion of their auditor’s report in this Report.

DESCRIPTION OF THE TRANSACTION

Acquisition of Primero Mining Corp.

On May 10, 2018, First Majestic Silver Corp. (“First Majestic” or the “Company”) completed the acquisition of all of the issued and outstanding common shares (the "Arrangement") of Primero Mining Corp. (“Primero”) pursuant to the terms and conditions of an arrangement agreement (the “Arrangement Agreement”) between First Majestic and Primero dated January 11, 2018. Under the terms of the Arrangement Agreement, First Majestic issued an aggregate of 6,418,594 common shares to Primero shareholders, on the basis of 0.03325 of a First Majestic common share for each Primero common share (the "Exchange Ratio").

The Arrangement also provided for the issuance by First Majestic of an aggregate of 221,908 replacement stock options (the “Replacement Options”) to the holders of outstanding Primero options, at exercise prices adjusted by the Exchange Ratio. Under the Arrangement, all existing warrants of Primero also became exercisable to acquire First Majestic shares at exercise prices adjusted by the Exchange Ratio. After the effective time of the Arrangement, such warrants are exercisable for an aggregate of 366,124 common shares of the Company.

San Dimas Stream Restructuring

In connection with the Arrangement, First Majestic terminated the pre-existing silver purchase agreement with Wheaton Precious Metals Corp. (“WPM”) and its subsidiary, Wheaton Precious Metals International Ltd. (“WPMI”), relating to the newly acquired San Dimas Mine and entered into a new precious metal purchase agreement (the “New Stream Agreement”) with WPMI and FM Metal Trading (Barbados) Inc., a wholly-owned subsidiary of First Majestic.

Pursuant to the New Stream Agreement, WPMI is entitled to receive 25% of the gold production and 25% of the silver production converted to gold equivalent at a fixed exchange ratio of 70:1 at San Dimas in exchange for ongoing payments equal to the lesser of $600 (subject to a 1% annual inflation adjustment) and the prevailing market price, for each gold ounce delivered to an offtaker under the agreement. As part of the termination of the previous silver purchase agreement, WPMI received 20,914,590 common shares of First Majestic with an aggregate fair market value of approximately $143.1 million.

Settlement of Primero Convertible Debentures

In connection with the Arrangement, First Majestic caused Primero to pay out all outstanding amounts of Primero’s $75.0 million convertible debentures (the "Debentures") which, in accordance with their terms, matured on May 11, 2018.

Financing

To fund the repayment of the Debentures, amounts outstanding under Primero's existing revolving credit facility and other costs related to the closing of the Arrangement, the Company raised cash through the following debt financing arrangements:

A $75.0 million senior secured revolving term credit facility (the “New Credit Facility”) which was used to replace an existing First Majestic credit facility and the prior credit facility of Primero. The New Credit Facility will mature on the third anniversary date but can be prepaid in advance of such date. Interest will accrue at LIBOR plus an applicable range which is dependent on certain financial parameters of First Majestic.

$156.5 million unsecured senior convertible debentures (the “Notes”) issued on January 29, 2018 and February 15, 2018, respectively, the proceeds of which were used primarily for repayment of the Debentures, other costs related to the closing of the Arrangement and general working capital purposes. The Notes mature on March 1, 2023 and bear an interest rate of 1.875% per annum. The Notes are convertible into common shares of the Company at a conversion rate of 104.3297 common shares per $1,000 principal amount of Notes converted, representing an initial conversion price of $9.59 per common share, subject to certain anti-dilution adjustments.

BASIS OF PRESENTATION

The unaudited pro forma condensed consolidated statement of financial position of First Majestic as at March 31, 2018 and the unaudited pro forma condensed consolidated statements of loss for the three months ended March 31, 2018 and for the year ended December 31, 2017 have been prepared, for illustrative purposes only, to give effect to the acquisition of Primero by First Majestic pursuant to the assumptions described in notes 3 and 4 of these unaudited pro forma condensed consolidated financial statements. These unaudited pro forma condensed consolidated financial statements have been prepared based on financial statements which were prepared in accordance with International Financial Reporting Standards (“IFRS”) as issued by the International Accounting Standards Board and have been compiled from the following historical information:

Pro forma condensed consolidated statement of financial position combining:

The unaudited condensed interim consolidated statement of financial position of First Majestic as at March 31, 2018; and

The unaudited condensed consolidated interim statement of financial position of Primero as at March 31, 2018.

Pro forma condensed consolidated statement of loss for the three months ended March 31, 2018 combining:

The unaudited condensed interim consolidated statements of loss of First Majestic for the three months ended March 31, 2018; and

The unaudited condensed consolidated interim statements of operations and comprehensive income (loss) of Primero for the three months ended March 31, 2018.

Pro forma consolidated statement of loss for the year ended December 31, 2017 combining:

The audited consolidated statements of loss of First Majestic for the year ended December 31, 2017; and

The audited consolidated statements of operations and comprehensive loss of Primero for the year ended December 31, 2017.

BASIS OF PRESENTATION (continued)

The accounting policies used in the preparation of these unaudited pro forma condensed consolidated financial statements are those set out in First Majestic’s audited consolidated financial statements as at December 31, 2017 and condensed interim consolidated financial statements as at March 31, 2018. In preparing the unaudited pro forma condensed consolidated financial statements, a review was undertaken to identify accounting policy differences between First Majestic and Primero where the impact was potentially material. The significant accounting policies of Primero conform in all material respects to those of First Majestic.

PRO FORMA PURCHASE PRICE ALLOCATION

These unaudited pro forma condensed consolidated financial statements have been prepared based on a total of 27,333,184 First Majestic common shares issued consisting of: (a) 6,418,594 common shares in exchange for all issued and outstanding Primero shares as at March 31, 2018 and (b) 20,914,590 common shares in relation to restructuring of the stream arrangement with WPM. The value of the First Majestic common shares issued was calculated based on the closing price of First Majestic common shares on May 9, 2018 of $6.84 (CAD$8.80) for the purpose of preparing these consolidated pro forma financial statements. The final common share purchase consideration was determined based on the closing market price of First Majestic’s common shares on the day before the closing date of the acquisition.

The transaction has a total consideration of $187.0 million including the following items at March 31, 2018:

27,333,184 First Majestic common shares at $6.84 per share (CAD$8.80) for total share consideration of $187.0 million; and

Nominal value of replacement stock options issuable to existing Primero option holders and amended warrants.

PRO FORMA ASSUMPTIONS AND ADJUSTMENTS

The unaudited pro forma condensed consolidated statement of financial position reflects the following adjustments as if the business combination of Primero had occurred on March 31, 2018.

To record proceeds from the new $75.0 million three year revolving credit facility, of which $36.0 million was drawn to pay down First Majestic and Primero’s pre-existing debt facilities.

To record the settlement of First Majestic and Primero’s pre-existing debt facilities.

To record the settlement of Primero’s $75.0 million principal amount of convertible debentures.

To record the issuance of 6,418,594 First Majestic common shares to Primero shareholders with a fair value of $43.9 million based on $6.84 (CAD$8.80) per share being the closing price of First Majestic’s shares at May 9, 2018; and elimination of historical equity of Primero on acquisition. The estimated fair value of the acquired mining interests based on the unallocated purchase consideration resulted in a $26.4 million pro-forma adjustment to mining interests.

To record the issuance of 20,914,590 First Majestic common shares with a fair value of $143.1 million to WPMI for the new stream arrangement based on 25% of the gold equivalent production at San Dimas for ongoing payment of $600 per equivalent gold ounce. The shares issued are valued at a price of $6.84 (CAD$8.80) per share being the closing price of First Majestic’s shares at May 9, 2018.

To record the deferred tax effect due to adjustments d) and e) above at the Mexican effective tax rate of 35.25% with a corresponding debit to goodwill.

To record transaction costs incurred by First Majestic for the acquisition of Primero.

To record estimated transaction costs incurred by Primero.

To adjust for the estimated impact of the New Stream agreement with WPMI on revenue:

For the three months ended March 31, 2018, the revenue adjustment was estimated based on repricing of 1.4 million ounces of silver revenue from $4.32 per ounce, the price per the previous stream agreement, to $16.77 per ounce, the average market price for the three months ended March 31, 2018, and 10,704 ounces of gold equivalent revenue from $1,330 per ounce, the average market price for the three months ended March 31, 2018, to $600 per ounce, the price per the New Stream agreement;

For the year ended December 31, 2017, the revenue adjustment was estimated based on repricing of 3.9 million ounces of silver revenue from $4.30 per ounce, the price per the previous stream agreement, to $17.04 per ounce, the average market price for the year ended December 31, 2017, and 28,799 ounces of gold equivalent revenue from $1,261 per ounce, the average market price for the year ended December 31, 2017, to $600 per ounce, the price per the New Stream agreement.

To adjust depletion, depreciation and amortization as a result of the increased value of mining interests attributed to the San Dimas Mine arising from the purchase price allocation per Note 3.

To eliminate financing costs on existing Primero and First Majestic debt facilities as a result of the settlements described in b) and c) above.

To record pro-forma financing costs related to First Majestic’s new $75.0 million credit facility as described in a) above.

To record pro-forma financing costs related to First Majestic’s new $156.5 million convertible debentures.

PRO FORMA ASSUMPTIONS AND ADJUSTMENTS (continued)

To eliminate mark-to-market gain on existing Primero convertible debentures and warrants as a result of their settlements described in c) above.

To record the deferred tax recovery at 35.25%, the effective tax rate in Mexico, relating to adjustments per j) to o) above.