SouthGobi Announces Revocation of Cease Trade Order

VANCOUVER, British Columbia, Feb. 08, 2021 (GLOBE NEWSWIRE) -- SouthGobi Resources Ltd. (TSX: SGQ, HK: 1878) (“SouthGobi” or the “Company”) is pleased to announce that, on February 5, 2021, the British Columbia Securities Commission, the Company’s principal securities regulator in Canada, and the Ontario Securities Commission have granted a full revocation of the cease trade order issued against the Company on June 19, 2020 (the “Cease Trade Order”).

The Cease Trade Order was originally issued as a result of the Company’s failure to file prior to the prescribed filing deadline (i) its annual audited financial statements for the fiscal year ended December 31, 2019 and accompanying Management Discussion & Analysis and CEO and CFO certificates; (ii) its Annual Information Form for the fiscal year ended December 31, 2019; and (iii) its interim consolidated financial statements for the three month period ended March 31, 2020 and accompanying Management Discussion & Analysis and CEO and CFO certificates (collectively, the “Required Filings”). As date of hereof, the Company has remedied its filing defaults by filing on SEDAR each of the Required Filings, as well as (i) its interim consolidated financial statements for the three and six month periods ended June 30, 2020 and accompanying Management Discussion & Analysis and CEO and CFO certificates; and (ii) its interim consolidated financial statements for the three and nine month periods ended September 30, 2020 and accompanying Management Discussion & Analysis and CEO and CFO certificates.

Although the Cease Trade Order has now been revoked, trading in the Company’s common shares on the TSX remains halted as of the date hereof. As announced in the Company’s press releases dated September 13, 2020 and December 17, 2020, the TSX is reviewing the Company’s eligibility for continued listing of its common shares on the TSX pursuant to the TSX’s Remedial Review Process (“TSX Delisting Review”) and the TSX Continued Listing Committee is scheduled to meet on February 11, 2021 to consider whether or not to suspend trading in and delist the common shares of the Company. If the Company fails to demonstrate to the TSX that no delisting criteria remain applicable on or before February 16, 2021, the Company’s common shares will be delisted from the TSX 30 days from such date. While the Company is taking such actions as it considers necessary in order to satisfy the TSX that no delisting criteria remain applicable, there can be no assurance that the Company will be able to do so prior to the deadline set by the TSX. If the Company’s common shares are delisted by the TSX, this would be an event of default under the US$250 million convertible debenture dated November 9, 2009 (the “Convertible Debenture”) with Land Breeze II S.à.r.l. (“Land Breeze”), which would result in the automatic termination of the deferral periods under the deferral agreement dated November 19, 2020 (the “2020 November Deferral Agreement”) and all principal, interest and other amounts owing under the Convertible Debenture and the 2020 November Deferral Agreement becoming immediately due and payable, in each case without the necessity of any demand upon or notice to the Company by Land Breeze.

The Company will make further announcements with respect to the TSX Delisting Review process as and when appropriate.

CONTINUED SUSPENSION OF TRADING

Trading in the common shares of the Company on the Toronto Stock Exchange and the Hong Kong Stock Exchange has been suspended since June 19, 2020 and August 17, 2020 respectively and will remain suspended until further notice.

If there is any inconsistency or discrepancy between the English version and the Chinese version, the English version shall prevail.

About SouthGobi

SouthGobi, listed on the Toronto and Hong Kong stock exchanges, owns and operates its flagship Ovoot Tolgoi coal mine in Mongolia. SouthGobi produces and sells coal to customers in China.

Contact:

Website: www.southgobi.com