Mr. Alexander Langer reports

SIERRA MADRE ANNOUNCES CLOSING OF $10.3 MILLION PRIVATE PLACEMENT OF COMMON SHARES AND SUBSCRIPTION RECEIPTS

Sierra Madre Gold and Silver Ltd. has closed the second tranche of its previously announced best effort brokered private placement financing in connection with the company's acquisition of the La Guitarra silver-gold mine from First Majestic Silver Corp.

The private placement was led by Beacon Securities Ltd. and Canaccord Genuity Corp. on behalf of a syndicate of agents including Haywood Securities Inc.

The second tranche is composed of: (i) 1.3 million common shares of the company at a price of 65 cents per common share for gross proceeds of $845,000; and (ii) 5,123,092 subscription receipts at a price of 65 cents per subscription receipt for gross proceeds of $3,330,010, for aggregate gross proceeds under the second tranche of $4,175,010. Together with the first tranche, the private placement raised aggregate gross proceeds of $10,353,030.55.

Each subscription receipt shall, without the payment of any additional consideration, automatically convert into one common share upon the earlier of: (i) the holder of the subscription receipt receiving written notice from the company of conversion; or (ii) Sept. 15, 2023. The subscription receipt proceeds were placed into escrow and will be released to the company upon satisfaction of the escrow release conditions. However, in the event that the company provides written notice to the holders of subscription receipts of termination, then all of the issued and outstanding subscription receipts will be cancelled, and the escrowed proceeds will be used to pay holders of subscription receipts an amount equal to 65 cents per subscription receipt held plus all interest accrued (as described below), less any tax required to be deducted and/or withheld.

The subscription receipt proceeds shall accrue interest at a rate of 10 per cent per annum, less any tax required to be deducted and/or withheld, payable only upon termination. Any interest accrued shall be paid on, and only on, the date of termination. For greater clarity, no interest shall be payable on any of the subscription receipt proceeds upon satisfaction of the escrow release conditions and the conversion of the subscription receipts into common shares.

The company will use the net proceeds of the private placement for the development of La Guitarra property, advancement of engineering studies and general working capital purposes.

In connection with the second tranche, the agents have received a total cash commission of $50,700, equal to 6 per cent of the gross proceeds raised from the sale of common shares under the second tranche, and have been issued 78,000 compensation options, equal to 6 per cent of the aggregate number of common shares sold pursuant to the second tranche. Each compensation option is exercisable into one common share at a price of 65 cents per compensation option for a period of 24 months from the date of issuance. Together with the first tranche, the agents received an aggregate cash commission of $219,667.38 and a corporate finance fee of $77,700 (inclusive of applicable taxes), and were issued 444,950 compensation options.

Certain directors and officers of the company purchased or acquired direction and control over a total of 1,270,500 subscription receipts under the first tranche and 2,199,700 subscription receipts under the second tranche. The placement to those persons constitutes a related-party transaction within the meaning of Multilateral Instrument 61-101 (Protection of Minority Security Holders in Special Transactions). Notwithstanding the foregoing, the directors of the company have determined that the interested parties' participation in the private placement will be exempt from the formal valuation and minority shareholder approval requirements of MI 61-101 in reliance on the exemptions set forth in sections 5.5(a) and 5.7(1)(a) of MI 61-101. The company did not file a material change report 21 days prior to the closing of the private placement as the details of the participation of interested parties had not been confirmed at that time.

The securities issued in connection with the second tranche are subject to a four-month hold period from the date of closing of the second tranche, in addition to any other restrictions under applicable law. The common shares are expected to resume trading on the TSX Venture Exchange on or around June 5, 2023. The private placement remains subject to certain conditions, including the receipt of final approval of the TSX Venture Exchange.

About Sierra Madre Gold and Silver Ltd.

Sierra Madre (TSX Venture Exchange: SM) is a precious metal development and exploration company, focused on the restart of La Guitarra mine in the Temascaltepec mining district, Mexico, and the exploration and development of its Tepic and La Tigra properties in Nayarit, Mexico. La Guitarra mine is a permitted, past-producing underground mine, which includes a 500-tonne-per-day processing facility that operated until mid-2018.

The 2,600-hectare Tepic project hosts low-sulphidation epithermal gold and silver mineralization with an existing historic resource. La Tigra, located 148 kilometres north of Tepic, has been mined historically. Sierra Madre's maiden 2022 drill program at the site intercepted shallow mineralization.

Sierra Madre's management has played key roles for managing exploration and development of more than 22 million ounces gold and 600 million ounces silver in combined reserves and resources. Sierra Madre's team of professionals has collectively raised over $1-billion for mining companies.

We seek Safe Harbor.