Drake Gold Resources, Inc. Releases Comprehensive Corporate Development Strategy

Under the corporate model developed by Drake Gold Resources and its consultants the company has chosen to seek only internal financing by insiders. This financing has been contingent upon repayment from cash flows and not based on diluting the value of Drake with stock issuances. The dedication to this model can be seen in that the company has issued no free trading stock for the repayment of debt. Indeed there has been a stock buyback and cancellation of 70 million authorized shares personally funded by Drake Gold Resources Chairman and Director Clayton Smith. The share cancellation and buyback was achieved through a transaction that will result in no cost to Drake. The shares were acquired by Clayton Smith with personal assets so that the transaction would result in no expense to Drake Gold Resources in debt or future consideration.

Reflecting on this Mr. Smith stated, "I did what I thought was best as a shareholder, not as an insider looking to maximize for only personal benefit. As an investor I wanted to maximize the value of the shares that are held by myself and in turn all of Drake shareholders. I did this by canceling the shares rather than acquiring them for myself. The exchange for the shares was based on a negotiation with a group of shareholders in which I offered equity in another company to them for their shares. The equity came at a substantial cost to me but I found that by just canceling the shares I am building more value for myself as well. This was entirely an off book transaction for Drake. There has been no added debt or issuance of any common or preferred shares to support this transaction. The equity I traded was completely unrelated to Drake but the benefit is clear."