Silverstone (TSX-V: SST) news: new deal with Aquiline

http://www.kitco.com/pr/1669/article_02082008082028.pdf

FOR IMMEDIATE RELEASE
February 8, 2008
NOT FOR DISSEMINATION IN THE UNITED STATES OR FOR RELEASE TO U.S.
NEWSWIRE SERVICES

Silverstone Agrees to Purchase CDN$17.5 Million Convertible Debenture from Aquiline
FEB 8, 2008: Toronto, ON and Vancouver, BC – Aquiline Resources Inc. (TSX: AQI)
(“Aquiline”) and Silverstone Resources Corp. (TSX-V: SST) (“Silverstone”) are pleased to
announce that Silverstone has agreed to purchase a CDN$17.5 million convertible debenture
(the “Debenture”) from Aquiline, which represents the first step of a potentially larger silver
transaction. The Debenture must be converted into, at Silverstone’s option, either common
shares of Aquiline (“Common Shares”) at a conversion price of CDN$12.00 per Common
Share, or a contract (the “Contract”) granting Silverstone the right to purchase 12.5% of the life
of mine payable silver from the Loma de La Plata zone (the “Property”), which is one of seven
zones comprising the Navidad project, or if unavailable, from the other zones of the Navidad
project. See “Transaction Structure” below for further information.
The initial Aquiline drill holes at Loma de La Plata were completed in May, 2007 and by the
release of Aquiline’s resource update on November 15, 2007 the new high grade, near surface
deposit had grown to contain 9.1 million tonnes at an average grade of 225 g/t silver and 0.09%
lead or 66 million contained silver ounces in the Indicated category plus 17.3 million tonnes
grading 159 g/t silver and 0.11% lead or 89 million contained silver ounces in Inferred
resources (Snowden Mining Industry Consultants, 2007). The Loma resource is contained
within the larger Navidad resource of 127.7 million Measured and Indicated tonnes grading 110
g/t silver and 1.06% lead (453 million oz Ag M+I ) and 49.0 million Inferred tonnes grading
97 g/t silver and 0.5% lead (153 million oz Ag I). Drilling is ongoing at Navidad with three
rigs, two of which are focused on new discoveries and resource expansion.
The transaction is expected to close on the date of this press release and the proceeds of
CDN$17.5 million will be used to satisfy a payment to IMA Exploration Inc. that is required
for the transfer of title to the Navidad property to Aquiline.
Darren Pylot, President and Chief Executive Officer of Silverstone commented, “Silverstone is
extremely happy to be associated with such a world class deposit and looks forward to working
with Aquiline in bringing the property to production.” At Aquiline’s request, Silverstone will
provide technical assistance to Aquiline, at Aquiline’s expense and on terms to be negotiated.

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Several of Silverstone’s management personnel, employees and consultants have a track record
of developing mining projects in Mexico and South America, including Argentina.
Blaise Yerly, Chairman of Aquiline, commented “We are pleased to have secured significant
funding for Navidad in a unique structure that will result in minimal dilution to shareholders.
Silverstone has demonstrated an ability to execute this model successfully and profitably and is
a partner who we believe will add strategic value as the project makes the transition from
exploration to development.”
Transaction Structure
Silverstone may elect to convert the Debenture into Common Shares at any time until the
Conversion Deadline, which is 30 days after the earlier of: (a) 23 months from the date of the
Debenture; and (b) the completion of a feasibility study on the Property, the decision of
Aquiline to proceed with a mine and receipt of all necessary permits to proceed with
construction of a mine (the “Maturity Date”).
The election to convert the Debenture into the Contract may only be made after the Maturity
Date and up to the Conversion Deadline. Silverstone and Aquiline shall negotiate a definitive
Contract within 120 days from the purchase of the Debenture and the Contract will be subject
to Exchange approval. The Contract will provide Silverstone with the right to purchase 12.5%
of the life of mine payable silver from the Property with a minimum of one million ounces of
silver per year from the Property, or if unavailable, from other Navidad project production, for
a minimum 12.5 year period. Upon conversion to the Contract, the CDN$17.5 million face
value of the Debenture will form part of an upfront payment by Silverstone of US$50 million to
secure the silver, structured as follows:
- US$17,599,750 (CDN$17.5 million), the Debenture face value
- US$14,900,250 on the Maturity Date
- US$17.5 million in four equal instalments of US$4.375 million starting three
months after construction commences to 12 months after construction commences
In addition to this upfront payment, Silverstone will pay the lesser of US$4.00 per ounce of
silver and the prevailing market price per ounce of silver on the London Metal Exchange at the
time production is delivered.
The Debenture carries a coupon of 150,000 warrants in lieu of interest, with each warrant
entitling Silverstone to purchase one Common Share at an exercise price of CDN$13.00 per
Common Share for a period expiring six months after the Conversion Deadline.
Silverstone will also have a right of first offer with respect to the sale of any additional future
silver production streams by Aquiline on any Aquiline project.
Fees and Conditions
PI Financial Corporation will receive a finder’s fee from Aquiline of 6% in cash of the
Debenture principal amount (CDN$1.05 million) and 87,500 warrants with the same terms as
those granted to Silverstone.

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Closing of the transaction is subject to receipt of all necessary approvals, including approval of
the TSX Venture Exchange and approval of the Toronto Stock Exchange.
Under the guidelines of the National Instrument 43-101, the Qualified Person for Aquiline’s
Navidad Project is Mr. John J. Chulick who is a registered geologist in the State of California.
Mr. Chulick has reviewed the technical content of this release.
ABOUT SILVERSTONE
Silverstone is a growth oriented silver mining company with 100% of its revenue from silver
production. Silverstone expects to have 2008 silver sales of approximately 2 million ounces
and increasing to more than 3 million ounces in 2009. More information is available online at
www.silverstonecorp.com.
ABOUT AQUILINE RESOURCES
Aquiline Resources Inc. is an exploration and development company advancing one of the
world’s largest undeveloped silver deposits (Navidad), as well as a gold deposit (Calcatreu),
both in Argentina. Calcatreu is currently being explored with the objective of expanding the
resource to one million gold-equivalent ounces.

FORWARD-LOOKING STATEMENTS
This press release includes certain "forward-looking statements". All statements, expressed or implied,
regarding the proposed transaction between Aquiline and Silverstone and in respect of the future
development of the Navidad property, are forward-looking statements that involve various risks and
uncertainties, as disclosed under the heading "Risk Factors" and elsewhere in Aquiline and Silverstone
documents filed from time to time with applicable regulatory authorities. There can be no assurance
that such statements will prove to be accurate and actual results and future events could differ materially
from those anticipated in such statements.

CONTACT INFORMATION
Aquiline Resources Inc. Silverstone Resources Corp.
Flora Wood Chris Tomanik or Mark Patchett
(416) 599-4133 (604)637-8151
flora@aquiline.com ctomanik@silverstonecorp.com or
mpatchett@silverstonecorp.com

Heavy "stream" of positive news-flow coming for Silverstone

1. Resource estimate for the Copala property. Silverstone is working to get Copala into 43-101 compliance. All of Silverstone's "non-silverstream" properties total perhaps 100 million ounces of historical silver resources. They are working to report compliant resources as the new drilling data becomes available. I believe we are close; this information is long overdue.

2. Capstone - resource upgrade at its Cozamin mine. Silverstone to benefit. As Capstone increases silver resources and/or production, those things accrue to the account of Silverstone. Capstone's increased silver resources will eventually become long-term silver sales to Silverstone, and Capstone's increased production due to their mine expansion is now becoming near-term silver sales to Silverstone.

3. Capstone looking for a merger or acquisition. Silverstone to benefit. We know that Capstone is looking for a good reason to spend its multi-million dollar cash hoard. If and when there is a merger or acquisition, the newly acquired mine(s) will likely be arranged soon thereafter to sell their silver to Silverstone for about $4.00 an ounce. In other words, any mines acquired by Capstone will become sources of future silver stream arrangements with Silverstone.

4. Silverstone to announce revenues for the first time. Silverstone has been making money from purchasing silver from Capstone Mining and Lundin Mining for about $4.00 an ounce, then re-selling that silver at market prices. Silverstone had about 1 million ounces of silver sales in 2007 and estimates 2 million ounces of silver sales in the current year. With higher silver prices, 2008 revenues could be 3 times that of 2007. The imminent news on this will be the beginning of Silverstone becoming an earnings per share story.

5. Silverstone is working on more silver stream acquisitions. The latest debenture deal with Aquiline gives Silverstone the right to convert to a silver stream purchase contract in the future. That contract would be the third one for the company. Admittedly the silver from that deal is at least 2+ years away, but that deal does not preclude Silverstone from finalizing and announcing very soon another silver stream acquisition for which the payoff is either short term or immediate. The next deal should greatly increase the company's creditable resources and signed-up silver purchase arrangements, and nudge the company closer to the silver "big leagues".