Mr. Cameron Tymstra reports

TARACHI GOLD SIGNS DEFINITIVE AGREEMENT FOR US$5.7 MILLION SALE OF MAGISTRAL PROJECT

Further to its news release dated Jan. 26, 2023, Tarachi Gold Corp. has signed a definitive agreement dated May 2, 2023, with Compania Minera de Atocha SA de CV for the sale of the company's Magistral project in Mexico.

Pursuant to the agreement, Tarachi expects to receive cash payments totalling $5.7-million (U.S.) (approximately $7.6-million) from Atocha as follows:

• $2.55-million (U.S.) will be paid directly from Atocha to Tarachi on or before closing;
• $500,000 (U.S.) of the $1-million (U.S.) currently held in a Canadian escrow account will be released to Tarachi on or before closing; the remaining $500,000 (U.S.) in the escrow account will be released to Tarachi when Atocha concludes negotiations with the Ejido Magistral or after 12 months, whichever occurs first;
• $500,000 (U.S.) will be paid to Tarachi six months from closing, less any contingency costs, if any, that arise after closing that were incurred by Tarachi but not identified during due diligence;
• $500,000 (U.S.) will be paid to Tarachi when 50 per cent of the tailings located on the Magistral project have been mined, sold and/or processed or after the first complete calendar year of operation at the Magistral project, whichever occurs first;
• $500,000 (U.S.) will be paid to Tarachi when 100 per cent of the Magistral tailings have been mined, sold and/or processed or after the second complete calendar year of operation at the Magistral project, whichever occurs first;
• The amount of value-added tax currently owing as that tax benefit is realized by Atocha during operations and product sales from the Magistral project will be paid to Tarachi, estimated to total approximately $650,000 (U.S.); Tarachi anticipates the tax benefit will be realized by Atocha and paid to Tarachi within the first year of commercial operations at the Magistral project.

The schedule of payments, but not the total sum, differs slightly from the letter agreement announced by Tarachi on Jan. 26, 2023.

In connection with the execution of the agreement, Tarachi has also agreed with Manto Resources SA de CV to settle all outstanding obligations owed to Manto relating to the Magistral project in exchange for 15 per cent of all payments Tarachi receives from Atocha.

The company and Atocha expect to close the transaction on or before May 17, 2023.

Todd Roth has stepped down from his role as vice-president, operations, to pursue other opportunities. The company would like to thank Mr. Roth for his efforts in helping Tarachi develop the Magistral project over the past year.

About Tarachi Gold Corp.

Tarachi is a Canadian-listed junior gold exploration company focused on exploring and developing projects in Mexico.

We seek Safe Harbor.