Update ON Payment Obligations Under November 2022 Deferral Agreement
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November 17, 2023
UPDATE ON PAYMENT OBLIGATIONS UNDER NOVEMBER
2022 DEFERRAL AGREEMENT
VANCOUVER – SouthGobi Resources Ltd. (TSX-V: SGQ, HK: 1878) (“SouthGobi” or the
“Company”) Reference is made to the announcements of the Company dated November 11,
2022, August 30, 2023 and October 13, 2023 (collectively, the “ Announcements”) and the
Management Proxy Circular of the Company dated July 20, 2023 (the “ Management Proxy
Circular”) in relation to the deferral agreements under the Convertible Debenture. Unless
otherwise specified, terms used in this announcement shall have the meaning as defined in
the Announcements and the Management Proxy Circular.
The Company announces that, on Nove mber 15, 2023, and in accordance with the terms of
the Convertible Debenture and the related deferral agreement dated November 11, 2022 (the
“November 2022 Deferral Agreement ”), the Company paid JD Zhixing Fund L.P. (“ JDZF”,
the Company’s substantial shareholder) the US$7,065,753 of cash interest which is due and
payable on November 19, 2022 under the Convertible Debenture, the payment of which was
deferred under the November 2022 Deferral Agreement until November 19, 2023.
On November 17, 2023, JDZF agreed to waive (the “ Waiver”) the Company’s payment
obligations under the November 2022 Deferral Agreement in relation to: (i) the remaining
US$1,100,000 of payment-in-kind interest which was payable on November 19, 2022 under
the Convertible Debenture (t he “November 2022 PIK Interest ”), the payment of which was
deferred under the November 2022 Deferral Agreement until November 19, 2023 (the
“Waived PIK Interest Default ”), as well as the right to collect deferral fees in respect of the
November 2022 PIK In terest under the November 2022 Deferral Agreement for the period
between November 20, 2023 until January 19, 2024 (both dates inclusive); and (ii) the
management fees (the “November 2022 Deferred Management Fees”) which were payable
on November 15, 2022, F ebruary 15, 2023, May 16, 2023 and August 15, 2023 under the
amended and restated cooperation agreement dated April 23, 1019 (the “ Amended and
Restated Cooperation Agreement ”), the payments of which were deferred under the
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November 2022 Deferral Agreement until November 19, 2023 (the “ Waived Deferred
Management Fees Default”, and together with the Waived PIK Interest Default, the “Waived
Defaults”). In order to allow the Company to remedy the Waived Defaults, the Waiver as it
relates to the Waived PIK Interest Default will be in effect up to and until January 19, 2024 (or
such other date as may be agreed upon by JDZF and the Company in writing), and the Waiver
as it relates to the Waived Deferred Management Fees Default will be in effect up to and until
August 31, 2024 (or such other date as may be agreed upon by JDZF and the Company in
writing).
If there is any inconsistency or discrepancy between the English and Chinese version, the
English version shall prevail.
About SouthGobi
SouthGobi, listed on the Hong Kong Stock Exchange and the TSX Venture Exchange , owns
and operates its flagship Ovoot Tolgoi coal mine in Mongolia. It also holds the mining licences
of its other metallurgical and thermal coal deposits in South Gobi region of Mongolia.
SouthGobi produces and sells coal to customers in China.
Contact:
Investor Relations
Email: [email protected]
Mr. Ruibin Xu
Chief Executive Officer
Office: +1 604 762 6783 (Canada)
+852 2156 1438 (Hong Kong)
Website: www.southgobi.com
Forward-Looking Statements
Certain information included in this press release that is not current or historical factual
information constitutes forward -looking statements or information within the meaning of
applicable securities laws (collectively, “forward -looking statements”), including information
about the potential of further future deferrals of its payment obligations under the Convertible
Debenture. Forward-looking statements are frequently characterized by words such as “plan”,
“expect”, “project”, “intend”, “believe”, “anticipate”, "could", "should", "seek", "likely",
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"estimate" and other similar words or statements that certain events or conditions “may” or
“will” occur. Forward -looking statements are based on certain factors and assumptions
including, among other things, the Company’s ability to successfully fulfil its payment
obligations of the November 2022 PIK Interest on or before January 19, 2024 under the
Convertible Debenture and related November 2022 Deferral Agreement and the November
2022 Deferred Management Fees on or before August 31, 2024 under the Amended and
Restated Cooperation Agreement and the related November 2022 Deferral Agreement, and
other similar factors that may cause actual results to differ materially from what the Company
currently expects. Actual results may vary from the forward -looking statements. Readers are
cautioned not to place undue importance on forward -looking statements, which speaks only
as of the date of this disclosur e, and not to rely upon this information as of any other date.
While the Company may elect to, it is under no obligation and does not undertake to, update
or revise any forward -looking statements, whether as a result of new information, further
events or otherwise at any particular time, except as required by law. Additional information
concerning factors that may cause actual results to materially differ from those in such forward-
looking statements is contained in the Company’s filings with Canadian secur ities regulatory
authorities and the website of the Hong Kong regulatory filings and disclosures of listed issuer
information. These can be found under the Company’s profile on SEDAR+ and HKEXnews
respectively, at www.sedarplus.ca and www.hkexnews.hk.
Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is
defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy
or accuracy of this release.