Announcement

$10 Million Institutional Placement

11 February 2020

$10 Million Institutional Placement

• Commitments received for the subscription of 71,428,571 ordinary shares at an issue price of $0.14 per share with total funds raised before costs of $10 million

• The issue received strategic support by AIM-listed investment group, Metal Tiger PLC which will invest approximately $3.33 million

• Douglas Kirwin and Terry Grammer, two prominent geologists with significant deposit discovery and corporate development records, will join the board as part of the transaction

• The share offer was well supported by the top 4 shareholders and several of the directors

Transformative Equity Raising

The Directors of Australian-based and South Korean-focused gold explorer, ASX-listed Southern Gold Limited (‘Southern Gold’ or ‘the Company’) are pleased to announce that the Company has received binding commitments from sophisticated and institutional investors in respect of a placement of 71,428,571 ordinary shares in the Company at $0.14 per share to raise $10m million, subject to shareholder approval (‘Placement’). The objective of the Placement is to lift the Company’s gold exploration effort in South Korea to a more significant level, including a doubling of the field teams and diamond drilling rate.

Southern Gold is particularly pleased to announce that AIM-listed investment specialist, Metal Tiger PLC (‘Metal Tiger’), has subscribed for a cornerstone position in the Placement under a subscription agreement. The agreement provides the right for Metal Tiger to nominate one Director to the Company for so long as Metal Tiger holds an interest in the Company of at least 10%. Prominent geologist, Mr Terry Grammer (CV in Box 1 below) has been nominated under this provision.

Also joining the Southern Gold Board, effective immediately, is world-renowned economic geologist, Mr Douglas Kirwin (CV in Box 2 below). Mr Kirwin has been acting in a technical advisory capacity for Southern Gold but now steps up into a much more prominent role as non-Executive Director of the Company.

The share offering was also supported by the company’s four largest shareholders and several of the directors.

The new share issuance will be subject to shareholder approval at a general meeting of shareholders to be held in early to mid-March with a Notice of Meeting expected to be shortly forwarded to shareholders. Ashanti Capital Pty Ltd acted as Lead Manager and Bookrunner to the raising.

Southern Gold Managing Director, Mr Simon Mitchell:

“This is a truly transformative transaction as it injects significant project advancement funding that can immediately lift the exploration work rate across our South Korea gold holdings. Metal Tiger, as a new cornerstone investor, is technically sophisticated and highly selective. Its investment is an important vote of confidence in Southern Gold’s ability to leverage this unique position in South Korea into one of advanced discovery and value uplift. This is reinforced by the appointment to the Board of two industry-leading geologists, Douglas Kirwin and Terry Grammer, both with enviable discovery records, are top tier area-selection geologists and who appreciate what we are uncovering in South Korea.”

About Metal Tiger

Metal Tiger plc (‘Metal Tiger’), listed on the London Stock Exchange AIM Market ("AIM") with the trading code MTR, invests in high potential mineral projects with a base, precious and strategic metals focus. Metal Tiger invests in significantly undervalued and/or high potential opportunities in the mineral exploration and development sector worldwide. Metal Tiger has two investment divisions: Direct Equities and Direct Projects.

The Direct Equities Division invests in undervalued natural resource companies. The majority of its investments are listed on AIM, the TSX and the ASX, and includes a 3.5% interest in Sandfire Resources NL (ASX: SFR), a 19.99% interest in Cobre Ltd (ASX: CBE) and now a 14.90% interest in Southern Gold Ltd (ASX: SAU).

The Direct Projects Division is focused on the development of its key project interests in Botswana (Kalahari copper, silver), Spain (tungsten, gold) and Thailand (lead, zinc, silver, antimony, copper, gold).

Terry Grammer – From Metal Tiger Website

Terry is an award-winning geologist with over 40 years’ experience in mining and mineral exploration with extensive experience in Australia, Africa, Southeast Asia and New Zealand and has been involved in numerous ASX-listed companies that have achieved dramatic growth.

As geologist, Terry discovered the Cosmos Nickel deposit for ASX-listed Jubilee Mines NL which went on to be an ASX Top 200 company and for which Terry was awarded the AMEC (Association of Mining & Exploration Companies) joint Prospector of the Year in 2000. As co-founder Terry listed Western Areas NL (ASX:WSA) in 2000 (and served as Exploration Manager from 2000 to 2004) which became an ASX Top 200 company. Terry was Chairman of South Boulder Mines (ASX:STB) from 2008-2013 which grew to be an ASX Top 300 company. From 2010 to 2015, Terry was a director of Sirius Resources NL (ASX:SIR) and helped to guide the Company through the discovery, feasibility and development funding of the Nova nickel and copper deposits in Western Australia, that saw the company's share price dramatically rise from AUD$0.05 in July 2012 to a peak above AUD$5 per share in early 2013 and become an ASX Top 200 company. Terry was appointed a director of Kalahari Metals Ltd in July 2018.

Douglas Kirwin, MSc, FSEG, FAIG, FAUSIMM

Doug is an Australian geologist with 45 years of international experience. His exploration teams have been responsible for several well-known mineral discoveries which are now being mined, the most notable being the Hugo Dummett ore body at the giant Oyu Tolgoi gold copper deposit in Mongolia developed by Rio Tinto. He was executive vice president of Ivanhoe Mines from 1995 to 2012 during which time Doug’s team was responsible for the epithermal gold-silver discoveries in South Korea (Eunsan, Moisan and Gasado Island, all of which became mines) among others. Doug has been keen to more actively explore South Korea ever since.

Besides Hugo Dummett and the South Korean discoveries, Doug’s exploration group was responsible for the discovery of the Merlin Mo-Re deposit in Australia, the Ulugtau Au project in the Kyrgyz Republic and several gold discoveries such as Hill 217 in China and Kerta, Jelai and Seruyung in Indonesia.

Doug is currently an independent consulting geologist. Doug has an MSc in mineral exploration from James Cook University where he is currently an adjunct professor of geology and was President of the Society of Economic Geologists in 2019.

Southern Gold Limited: Company Profile

Southern Gold Ltd is a successful gold explorer listed on the Australian Securities Exchange (under ASX ticker “SAU”).

Southern Gold owns 100% of a substantial portfolio of high-grade gold projects in South Korea that are largely greenfield epithermal gold-silver targets in the south-west of the country. Backed by a first-class technical team, including renowned geologist Douglas Kirwin and Terry Grammer, Southern Gold’s aim is to find world-class epithermal gold-silver deposits in a jurisdiction that has seen very little modern exploration.

Southern Gold also holds a 50% equity interest in a Joint Venture company operated by JV partner, London-listed Bluebird Merchant Ventures (BMV) and that is looking to start gold production at the Kochang and Gubong projects in South Korea.

Forward-looking statements

Some statements in this release regarding estimates or future events are forward looking statements. These may include, without limitation:

• Estimates of future cash flows, the sensitivity of cash flows to metal prices and foreign exchange rate movements;

• Estimates of future metal production; and

• Estimates of the resource base and statements regarding future exploration results.

Such forward looking statements are based on a number of estimates and assumptions made by the Company and its consultants in light of experience, current conditions and expectations of future developments which the Company believes are appropriate in the current circumstances. Such statements are expressed in good faith and believed to have a reasonable basis. However, the estimates are subject to known and unknown risks and uncertainties that could cause actual results to differ materially from estimated results.

All reasonable efforts have been made to provide accurate information, but the Company does not undertake any obligation to release publicly any revisions to any “forward-looking statement” to reflect events or circumstances after the date of this presentation or ASX release, except as may be required under applicable laws. Recipients should make their own enquiries in relation to any investment decisions from a licensed investment advisor.

To read the announcement download the pdf below:

$10Million Institutional Placement