Mr. Martin Cooper reports

PELE MOUNTAIN RESOURCES ANNOUNCES CLOSING OF $5.9 MILLION SUBSCRIPTION RECEIPT FINANCING BY BHANG CANADA INC.

Further to the Nov. 9, 2018, announcement regarding the business combination pursuant to which, among other things, Pele Mountain Resources Inc. will complete a reverse takeover of Bhang Corp., a privately held Nevada corporation, and Bhang Canada Inc. (BCI), a special-purpose vehicle, Pele Mountain has completed a private placement financing of subscription receipts for gross proceeds of $5,905,010.50.

Under the offering, BCI issued an aggregate of 11,810,021 subscription receipts at a price of 50 cents per subscription receipt for gross proceeds of $5,905,010.50. The offering was composed of a brokered offering of subscription receipts, which was led by AltaCorp Capital Inc. as lead agent and sole bookrunner and included Echelon Wealth Partners Inc., Eight Capital and Industrial Alliance Securities Inc., and a non-brokered offering of subscription receipts.

Each subscription receipt is convertible, without additional consideration, into a unit of BCI, consisting of one common share of BCI and one-half of one common share purchase warrant of BCI. Each BCI warrant entitles the holder to purchase one BCI share at a price of 65 cents per share until 24 months after the completion of the RTO transaction, subject to acceleration in the event that the volume-weighted average price of the shares of Pele (as the resulting issuer) upon the completion of the RTO transaction on the Canadian Securities Exchange is equal to or greater than $1 over a period of 10 consecutive trading days. The subscription receipts will convert into BCI units upon satisfaction of the escrow release conditions, set out in the agency agreement entered into among the agents, BCI, Pele and Bhang on the date hereof. The BCI units and the compensation options (as defined herein) will be exchanged for corresponding securities, respectively, in the resulting issuer upon completion of the RTO transaction.

The net proceeds raised in connection with the offering, after fees and expenses incurred, and less 50 per cent of the agent's fee (as defined herein), have been deposited with Capital Transfer Agency ULC as subscription receipt agent. The escrowed proceeds will be held by Capital Transfer until the escrow release conditions have been satisfied.

In connection with the offering, the agents are entitled to receive: (i) a cash commission equal to 6 per cent of the aggregate proceeds of the portion of the brokered offering sold to subscribers sourced by the agents, (ii) a cash commission equal to 3 per cent of the aggregate proceeds from all other subscribers participating in the brokered offering, and (iii) a corporate finance fee, which cash commission and corporate finance fee totalled $215,550. The agents have received an aggregate number of compensation options equal to 6 per cent of the number of subscription receipts issued to subscribers sourced by the agents, and an aggregate number of compensation options equal to 3 per cent of the number of subscription receipts issued to certain subscribers on a president's list participating in the offering. Each compensation option entitles the holder to purchase one BCI unit at a price of 50 cents per BCI unit until 24 months after completing the RTO transaction. Fifty per cent of the agent's fee was paid on closing of the offering, with the rest to be paid on closing of the RTO transaction upon satisfaction of the escrow release conditions.

About Bhang Corp.

Founded by professional chef and master chocolatier, Scott Van Rixel, Bhang, headquartered in Miami, Fla., has been formulating and producing award-winning THC-(tetrahydrocannabinol)- and CBD-(cannabidiol)-infused products since 2010. What began as a cannabis-infused dark chocolate bar has now expanded to a widely recognized and awarded cannabis brand. Bhang's chocolate products expanded to include a premium collection of vapes, gums, mouth sprays and Bhang-branded merchandise. Through its licensees across the United States and around the globe, from public companies to platinum recording artists and organic food companies, Bhang has mastered the art of harnessing mutually beneficial partnerships to put its products in consumers' hands.

Cautionary notes

Investors are cautioned that, except as disclosed in the CSE listing statement to be prepared in connection with the RTO transaction, any information released or received with respect to the definitive agreement between Pele, Pele Acquisition Corp., Bhang and BCI dated Nov. 8, 2018, as amended (as filed under the company's corporate profile at SEDAR), or the RTO transaction may not be accurate or complete and should not be relied upon.

Trading in the common shares of Pele has been halted pursuant to the policies of the TSX-V, and the company expects that trading will remain halted pending the earlier of the delisting of Pele's shares from the TSX-V and termination of the definitive agreement. There can be no assurance that the conditions in the definitive agreement will be satisfied or that the RTO transaction will be completed as contemplated therein or at all.

About Pele Mountain Resources Inc.

Pele is focused on the development of renewable energy projects in Northern Ontario and also holds mineral resource interests in Northern Ontario. Management continues to seek new strategic opportunities to enhance shareholder value.

We seek Safe Harbor.