Mr. Chris McLeod reports

PACIFIC IMPERIAL ANNOUNCES DEBT SETTLEMENT

Pacific Imperial Mines Inc. has entered into debt settlement agreements with Chris McLeod (chief executive officer and director of the company) and Peter Holbek (director of the company) to fully settle debt owed by the company to the creditors in the aggregate amount of $238,807 for outstanding loans owing to Mr. McLeod and Mr. Holbek and for outstanding fees owing to Mr. Holbek (DBA Viking GeoScience) for geological services, by issuing an aggregate of 5,970,170 common shares of the company to the creditors at a deemed price of four cents per common share. The debt settlement is subject to the approval of the TSX Venture Exchange. The shares to be issued to the creditors will be subject to a hold period expiring on the date that is four months and one day after the date of issuance in accordance with applicable securities laws and the policies of the exchange.

The participation of the creditors in the debt settlement, in the amount of 4,608,260 common shares to be issued to Mr. McLeod, 250,000 common shares to be issued to Mr. Holbek and 1,111,910 common shares to be issued to Mr. Holbek (DBA Viking GeoScience) under the debt settlement constitutes a "related party transaction" under Multilateral Instrument 61-101 -- Protection of Minority Security Holders in Special Transactions. The company is exempt from the requirements to obtain a formal valuation and minority shareholder approval in connection with the participation of the insiders in the debt settlement in reliance on the exemptions contained in sections 5.5(b) and 5.7(1)(a) of MI 61-101, respectively, as the fair market value of the insider participation does not exceed 25 per cent of the company's market capitalization as determined in accordance with MI 61-101. The directors of the company unanimously approved the debt settlement, with Mr. McLeod and Mr. Holbek abstaining with respect to their participation. No materially contrary view or abstention was expressed or made by any director of the company in relation thereto.

About Pacific Imperial Mines Inc.

Pacific Imperial is a mineral exploration company based in Vancouver, Canada, engaged in the acquisition, exploration, evaluation and development of mineral properties in an acceptable risk environment. The company's current focus is on the Brownell property in Saskatchewan and the Babine and Fenton properties in British Columbia.

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