Mr. Lincoln Greenidge reports

PASOFINO GOLD ANNOUNCES A US$2.3 MILLION NON-BROKERED PRIVATE PLACEMENT TO INSIDERS

Pasofino Gold Ltd. has arranged a non-brokered private placement of up to 6,291,000 units of the company at 50 cents (or 37 U.S. cents) per unit for gross proceeds of up to $3,145,500 ($2.33-million (U.S.)).

Each unit will consist of one common share of the company and half of one common share purchase warrant. Each warrant will entitle the holder thereof to purchase one common share of the company at a price of 65 cents for a period of 18 months following the issue date of the units.

As disclosed in the company's Jan. 4, 2024, and Jan. 11, 2024, press releases, Hummingbird Resources PLC (AIM: HUM) (HB PLC), a shareholder (51 per cent) and control person of the company, has dedicated $2-million (U.S.) of the proceeds of its recent financing to invest in Pasofino. Accordingly, HB PLC has expressed an interest in subscribing for 5.4 million units.

As previously disclosed in the company's Jan. 17, 2022, press release, Esan Eczacibasi Endustriyel Hammaddeler Sanayi ve Ticaret Anonim Sirketi (ESAN), a shareholder (10 per cent) and insider of the company, has the right, but not the obligation, to subscribe under any private placement or prospectus offering of the company in such amount as would permit ESAN to maintain its shareholding interest in the company. Accordingly, ESAN has expressed its interest in subscribing for 891,000 units.

Following completion of the offering, ESAN would own 10 per cent of the issued and outstanding shares of Pasofino and HB PLC would own 53 per cent of the issued and outstanding shares.

The offering is expected to close in January, 2024, and is subject to certain closing conditions including, but not limited to, the receipt of all necessary approvals, the conditional listing approval of the TSX Venture Exchange and the applicable securities regulatory authorities. The securities issued under the offering will be subject to a hold period in Canada expiring four months and one day from the closing date of the offering.

The net proceeds of the offering will be used by the company in connection with advancement of the Dugbe gold project and working capital. The funds will be used to optimize the 2022 definitive feasibility study through fiscal year 2024 and further progress the project. Several opportunities to maximize the value of Dugbe and reduce the overall project capex profile have been identified, including the optimization of power usage, improvements to the metallurgical recovery rates and additional exploration activities.

About the Dugbe gold project

The 2,302-square-kilometre Dugbe gold project is in southern Liberia and situated within the southwestern corner of the Birimian supergroup, which is host to most West African gold deposits. To date, two deposits have been identified on the Dugbe gold project: Dugbe F and Tuzon discovered by Hummingbird entities in 2009 and 2011, respectively. The deposits are located within four km of the Dugbe shear zone, which is thought to have played a role in large-scale gold mineralization in the area.

Related party transaction

Each of HB PLC and ESAN are insiders of Pasofino and are participating in the offering. The offering is therefore a related party transaction under Multilateral Instrument 61-101 -- Protection of Minority Security Holders in Special Transactions. The company relied upon the exemptions from the minority shareholder approval and valuation requirements set out in sections 5.7(1)(a) and 5.5(a), respectively, of MI 61-101. The offering, including the subscriptions of HB PLC and ESAN, was approved unanimously by the directors of the company.

About Pasofino Gold Ltd.

Pasofino Gold is a Canadian-based mineral exploration company which, through its wholly owned subsidiary, owns 100 per cent of the Dugbe gold project (prior to the issuance of the government of Liberia's 10-per-cent carried interest).

We seek Safe Harbor.