Stonecap – Probe Expands Land Package

Probe announced the acquisition of the Ava-Claire property from Red Pine Exploration Inc. (RPX-TSXV; not covered), located approximately 20 km east of its flagship Borden Lake project.

• The Ava-Claire property is a very early stage regional exploration target with no historic drilling and only till sampling completed to date.

• Under the terms of the agreement, Probe will acquire a 100% interest in the Ava-Claire property with a payment of $100,000 to Red Pine and issuance of 100,000 common shares (restricted for four months and one day), as well as a 1.5% NSR on the property.

• Red Pine has done an early stage till sampling program consisting of 69 samples along two corridors parallel to Kapuskasing Structural Zone (KSZ). Of the 69 samples, 30 samples had isolated gold grains with one sample returning 10 gold grains.

• Probe is now in the process of putting together an exploration program to further investigate the source of the gold values previously assayed.

• This is still early stage, but we believe the acquisition of this grass root property bodes well for the company as it gives Probe further land package to explore prospective regional targets on its belt.

Valuation

Our adjusted net asset valuation of $3.49 is based on our DCF analysis of Borden Lake with a 0.45x multiple based on an unfunded scenario to get to our rounded target price of $3.50 per share.

Conclusion

With the acquisition of the Ava-Claire property, Probe is continuing to pursue its strategy of investigating regional targets on its belt and for a low cost has increased its regional land position. We are maintaining our Outperform Rating and $3.50 price target.