Early Warning News Release for Od Sar Trading Co., Limited

About this update from Southgobi Resources Ltd.

Early Warning News Release for Od Sar Trading Co., LimitedHong Kong, SAR--(Newsfile Corp. - July 13, 2026) - Od Sar Trading Co., Limited ("Od Sar" or the "Acquiror") announces that, upon execution of an assignment agreement (the "Assignment Agreement") and payment of the purchase price (the "Assignment") on July 9, 2026 (Pacific Time), being July 10, 2026 (Hong Kong time), it acquired from JD Zhixing Fund L.P. (the "Fund") US$19,000,000 of accrued payment-in-kind interest (the "Assigned PIK Interest") payable under the secured convertible debenture (the "Convertible Debenture") issued on November 19, 2009 by SouthGobi Resources Ltd. ("SouthGobi" or the "Issuer") having an outstanding principal amount of US$250,000,000. The Assignment was completed through a private agreement outside Canada and not through the facilities of any stock exchange or other marketplace.Under the terms of the Convertible Debenture, interest on the outstanding principal amount is payable in common shares of SouthGobi (the "Common Shares") at a rate of 1.6% per annum ("PIK Interest"). The Convertible Debenture provides that PIK Interest is satisfied by the issuance of such number of Common Shares as is determined by dividing the applicable PIK Interest amount by the applicable 50-day volume weighted average price ("VWAP") of the Common Shares as of the date of payment, calculated using trading on all stock exchanges on which the Common Shares are listed and converted into Canadian dollars in accordance with the terms of the Convertible Debenture.The Assigned PIK Interest forms part of US$25,100,000 of accrued PIK Interest under the Convertible Debenture and related deferral agreements that may be demanded for payment. Pursuant to the Assignment Agreement, Od Sar acquired all rights, title, benefits and privileges associated with the Assigned PIK Interest, including the right to receive the Common Shares issuable in respect thereof.Od Sar believes that the Assigned PIK Interest constitutes an interest in securities of SouthGobi for purposes of National Instrument 62-103 because the Assigned PIK Interest carries with it the right to receive Common Shares upon demand for payment in accordance with the Convertible Debenture.The applicable VWAP as of July 10, 2026 was approximately CAD$0.3272 per Common Share, equivalent to approximately US$0.2313 per Common Share using the applicable B...

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