Pegasus Resources Inc (SLTFF)

[Sam Dan]

FRONTLINE EXECUTED LOI TO OPTION ITS COPPERLODE PROPERTY TO PST

Frontline Gold Corp. has executed a letter of intent with Pistol Bay Mining Inc. wherein, subject to the analysis of the results, Pistol Bay has the option to acquire up to an 80-per-cent interest in its Copperlode property, in the Confederation Lake greenstone belt, by making certain payments and share issuances. The Confederation Lake greenstone belt lies 40 to 60 kilometres southeast of Red Lake, Ontario and is known to contain multiple deposits, zones and occurrences of volcanogenic massive sulphide (VMS) mineralization, dominated by zinc and copper, with associated silver and gold values.

Frontline's Confederation Lake - "Copperlode Property"

The Copperlode Property, with five known zinc-copper zones, consists of four mining claims comprising 31 claim units for a total area of approximately 496 hectares or 1,225 acres. Frontline holds the claims under option from a vendor. The Copperlode Property hosts two mineralized zones with historical mineral resources based on drilling by Copperlode Mines Ltd. and Rexdale Mines Ltd. in the 1960s and 1970s: The Copperlode "E" Zone has a historical resource of 145,000 tonnes with reported grades of 8.28% zinc, 1.02% copper and 24 grams per tonne silver. The Copperlode "D" Zone has a historical resource of 32,600 tonnes reported to average 7.58% zinc and 0.26% copper. These historical resources do not comply with current standards as spelled out in National Instrument 43-101. Insufficient work has been done on these zones by a qualified person to determine whether 43-101 compliant mineral resources exist.

Other mineralized zones on the Copperlode Property, with selected diamond drill intercepts, are:

Copperlode "B" zone, 6.3 metres @ 2.50% zinc and 1.68% copper

Copperlode "C" zone, 1.5 metres @ 0.21% zinc and 6.02% copper

Hornet Zone, 6.6 metres @ 7.56% zinc and 0.08% copper, also 5.03 metres @ 4.07% zinc and 1.13% copper. The Hornet zone was discovered by Noranda Exploration in 1997; it is open at depth and along strike.

The Copperlode Property lies approximately 4 kilometres from, and on strike with the Arrow Zone, which is on claims held by Pistol Bay. The Arrow Zone has a historical (2007), 43-101 compliant, indicated mineral resource of 2,071,000 tonnes grading 5.92% zinc, 0.75% copper, 21.1 grams per tonne (g/t) silver and 0.58 g/t gold, plus an inferred mineral resource of 120,552 tonnes grading 2.60% zinc, 0.56% copper, 18.6 g/t silver and 0.40 g/t gold (based on 3% zinc equivalent cutoff). An updated mineral resource estimate is being prepared for Pistol Bay.

Terms of Letter of Intent - Option Agreement

Upon completion of the airborne survey, Pistol Bay will have the option to acquire an initial 65 percent interest in the Copperlode Property from Frontline by making cash payments totaling $26,000, issuing a total of 450,000 common shares over a two year period and expending a total of $150,000 on exploration expenditures over a period of three years. The interest can be increased to 80 percent by paying Frontline an additional $50,000 and issuing 300,000 common shares within 90 days after earning the initial 65% interest. See Abitibi press release dated 05/05/2017: http://www.pistolbaymininginc.com/pdf/news/2017_05_05%20PST%20NR%20Copperlode%20LOI%20_final_.pdf Frontline is a Canadian junior mineral exploration company. The Company's principal Ontario properties include the following:

Red Lake Gold exploration properties consisting of 16 claims, totaling 6,400 acres on 160 claim units adjoining Pure Gold's Madsen Mine to the east and the south. This land package combined with the Company's Chukuni and White Horse Island Projects, provides the Company with one of the largest exploration land packages within the Red Lake District totaling just 9,600 acres.