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RAREX LIMITED M&A Activity 2018

Nov 25, 2018

65681_rns_2018-11-25_5fd01923-f9a5-477c-b54a-1b153866c986.pdf

M&A Activity

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26 November 2018

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ASX / MEDIA ANNOUNCEMENT

CLANCY AND PACTON SIGN DEFINITIVE AGREEMENT - HONG KONG GOLD PROJECT

Pilbara, Western Australia

Clancy Exploration Limited (ASX: CLY) (“ Clancy ” or the “ Company ”) is pleased to announce that further to its ASX announcement of October 11, 2018, it has entered into a Tenement Sale and Purchase Agreement (“ Agreement ”) for Pacton Gold Inc. (TSXV: PAC, OTC: PACXF, FSE: 2NKN) (“ Pacton ”) to acquire a 70% equity interest in the Hong Kong project (“ Hong Kong Project ”). The Hong Kong Project consists of a single granted exploration license covering 40.15 km[2] and directly adjoins Pacton’s Friendly Creek and Golden Palms projects.

Under the terms of the final Agreement, Pacton will pay Clancy an additional CDN$175,000 and issue 3,780,613 common Pacton shares to Clancy. This transaction is now only subject to the acceptance of the TSX Venture Exchange.

Upon completion of the acquisition, Pacton’s wholly-owned Australian subsidiary, Pacton Pilbara Pty Ltd (“ Pacton Pilbara ”) and Clancy will enter into a joint venture, with Pacton Pilbara acting as operator of the Hong Kong Project. A minimum of CDN$500,000 must be spent by Pacton Pilbara within two years of completion of the transaction. Clancy will be free carried with respect to expenditures until a decision to mine is made unanimously by both parties.

David Lenigas, Clancy’s Chairman commented;

“All documentation has now been finalised and signed with Pacton and the deal is now only subject to TSXV approval. We do not anticipate this TSXV approval to take too long. The funds provided will assist greatly in Clancy’s new Moroccan cobalt strategy. Pacton are aggressively exploring the Pilbara for gold, having accumulated a very significant land package in the region, and Pacton will be an excellent partner for Clancy on Hong Kong.”