Pinehurst Capital I Inc. (TSXV: PHT.P) (the “Corporation” or “Pinehurst”), a capital pool company listed on the TSX Venture Exchange (“TSXV”), on August 27, 2020 announced details of its proposed arm’s length qualifying transaction with Silver Bullet Mines Inc. (“Silver Bullet”), a mining company focused on silver exploration with its primary asset being the Black Diamond Property (the “Property”) located near Globe, Arizona.

Pinehurst entered into a letter of intent with Silver Bullet dated August 26, 2020 (the “Letter of Intent”) pursuant to which Pinehurst and Silver Bullet have agreed to complete a business combination (the “Transaction”) whereby Pinehurst will be the parent company (the “Resulting Issuer”) and 100% of the issued and outstanding of securities of Silver Bullet will be owned by the Corporation. Silver Bullet and Pinehurst have agreed to extend the expiry of the Letter of Intent to October 9, 2020.

Silver Bullet owns a 100% interest in the Property which consists of 232 mineral claims (4900 acres), centred on the Richmond Basin, 91 km west of Phoenix, Arizona. The Property includes several past producing silver mines including the McMorris, La Plata and Buckeye.

Silver Bullet has advised Pinehurst that the next stage of exploration has begun on the Property, including the evaluation of drill targets within Silver Bullet’s strict exploration criteria with mapping and an expansion of the soil sampling program. This initial work will also include work on the Buckeye Mine site to further determine the controls on mineralization and to explore for additional high-grade mineralization.

Summary of the Proposed Financing

The Letter of Intent contemplates that Silver Bullet will complete a non-brokered private placement (the “Silver Bullet Private Placement”) of aggregate proceeds of not less than C$3,000,000 by the issuance of Units at a price of thirty cents (C$0.30) per Unit. Each Unit will consist of one common share and one-half of one common share purchase warrant, with each whole warrant being exercisable for one common share at an exercise price of fifty cents (C$0.50) for a two-year term. Silver Bullet may engage an agent (the “Agent”) to act on a “commercially reasonable efforts” basis for the Silver Bullet Private Placement and in connection therewith may pay a commission to the Agent in an amount to be determined. The proceeds of the Silver Bullet Private Placement will be used to fund the recommended exploration program on the Property, continuing operating expenses, and for general working capital purposes.

Additional Information and Description of Significant Conditions to Closing

Completion of the Transaction is subject to a number of conditions, including but not limited to, approval by the TSXV. Other conditions include completion of the Silver Bullet Private Placement, satisfactory completion of due diligence reviews by Silver Bullet and Pinehurst, execution of a definitive agreement, board of directors’ approval of Pinehurst and Silver Bullet, certain shareholder approvals and certain other usual conditions. Trading of Pinehurst’s Common Shares will not resume until all documents required by the TSXV have been filed. This press release was drafted under the supervision of Ronald Wortel, P.Eng, who is the Qualified Person in accordance with NI43-101.

For further information, please contact:

David Rosenkrantz Pinehurst Capital I Inc., CEO e: drosenkrantz@patica.ca p: 416-865-0123

Peter M. Clausi Silver Bullet Mines Inc., VP Capital Markets e: pclausi@brantcapital.ca p: 416-890-1232

Information concerning Silver Bullet has been provided to the Corporation by Silver Bullet for inclusion in this press release.

Completion of the Transaction is subject to a number of conditions, including but not limited to, TSXV acceptance and if applicable pursuant to Exchange Requirements (as that term is defined in the policies of the TSXV), majority of the minority shareholder approval. Where applicable, the Transaction cannot close until the required shareholder approval is obtained. There can be no assurance that the Transaction will be completed as proposed or at all.

Investors are cautioned that, except as disclosed in the management information circular or filing statement to be prepared in connection with the Transaction, any information released or received with respect to the Transaction may not be accurate or complete and should not be relied upon. Trading in the securities of a capital pool company should be considered highly speculative.

The TSXV has in no way passed upon the merits of the proposed transaction and has neither approved nor disapproved the contents of this press release. Neither the TSXV nor its Regulation Services Provider (as that term is defined in the policies of the TSXV) accepts responsibility for the adequacy or accuracy of this release.

The securities referenced herein have not been, nor will be, registered under the United States Securities Act of 1933, as amended, and may not be offered or sold within the United States or to, or for the account or benefit of, U.S. persons absent U.S. registration or an applicable exemption from U.S. registration requirements. This release does not constitute an offer for sale of securities in the United States.

Cautionary and Forward-Looking Statements

This press release contains “forward-looking information” and “forward-looking statements” (collectively, “forward-looking statements”) within the meaning of applicable Canadian securities legislation. All statements, other than statements of historical fact, are forward-looking statements and are based on expectations, estimates and projections as at the date of this press release. Any statement that involves discussions with respect to predictions, expectations, beliefs, plans, projections, objectives, assumptions, future events or performance (often but not always using phrases such as “expects”, or “does not expect”, “is expected” “anticipates” or “does not anticipate”, “plans”, “budget”, “scheduled”, “forecasts”, “estimates”, “believes” or intends” or variations of such words and phrases or stating that certain actions, events or results “may” or “could, “would”, “might” or “will” be taken to occur or be achieved) are not statements of historical fact and may be forward-looking statements. In this press release, forward-looking statements relate, among other things, to: the Transaction and certain terms and conditions thereof; the business of Silver Bullet, information concerning the Property; the Silver Bullet Private Placement; shareholder, director and regulatory approvals; and future press releases and disclosure. Forward-looking statements are necessarily based upon a number of estimates and assumptions that, while considered reasonable, are subject to known and unknown risks, uncertainties, and other factors that may cause the actual results and future events to differ materially from those expressed or implied by such forward-looking statements. Such factors include, but are not limited to: general business, economic, competitive, political and social uncertainties; and the delay or failure to receive shareholder, director or regulatory approvals. 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 the forward-looking statements and information contained in this press release. Except as required by law, Pinehurst assumes no obligation to update the forward-looking statements of beliefs, opinions, projections, or other factors, should they change.

 

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