Novel Sunrise Investments Limited

January 11, 2017 16:30 ET

Novel Sunrise Sells 25,768,162 Common Shares of SouthGobi

VANCOUVER, BRITISH COLUMBIA--(Marketwired - Jan. 11, 2017) - Novel Sunrise Investments Limited (Novel Sunrise) announced that earlier today, but with effect from December 31, 2016, it completed the documentation of the sale of 25,768,162 common shares (the Purchased Shares) of SouthGobi Resources Ltd. (SouthGobi) to Voyage Wisdom Limited (Voyage Wisdom) pursuant to Voyage Wisdom's exercise of the call option contained in the option agreement between Novel Sunrise, Voyage Wisdom and the shareholders of Voyage Wisdom made as of April 15, 2016 (as amended by extension agreements dated April 21, 2016 and October 21, 2016, and as further amended and supplemented by a Settlement Agreement entered into on January 11, 2017, which is deemed to take effect as of December 31, 2016 (the Settlement Agreement)), for a total purchase price of RMB166,773,600 (equivalent to US$24,000,000 and Cdn$32,162,400 as at December 21, 2016) (the Consideration).

The Consideration was paid to, and accepted by, Novel Sunrise on December 21, 2016 in Chinese yuan renminbi (RMB), notwithstanding that the Option Agreement provided that the Consideration would be paid in US dollars. Under the terms of the Settlement Agreement, Voyage Wisdom has agreed that either (i) it will procure payment of US$24,000,000 to Novel Sunrise on or before December 31, 2017 (at which point the RMB paid as the Consideration would be refunded), or (ii) if such US$24,000,000 is not paid to Novel Sunrise on or before December 31, 2017, it will compensate Novel Sunrise in RMB for any foreign exchange decline in the USD value of the Consideration from December 21, 2016 to December 31, 2017.

Novel Sunrise agreed to sell the Purchased Shares to Voyage Wisdom in order to provide the shareholders of Voyage Wisdom, each of whom is a member of the senior management team of SouthGobi, with a significant equity position in SouthGobi in order to provide them with additional incentive to promote SouthGobi's interests and better align their interests with the interests of SouthGobi's shareholders.

As a result of its sale of the Purchased Shares, Novel Sunrise currently owns and controls 46,358,978 common shares of SouthGobi, representing 17.99% of the issued and outstanding common shares of SouthGobi.

Each statement in this press release of the percentage of the issued and outstanding common shares of SouthGobi owned or controlled by Novel Sunrise is based on the disclosure of the number of issued and outstanding common shares of SouthGobi contained in the public disclosure documents filed by SouthGobi on SEDAR.

An early warning report is being filed by Novel Sunrise in accordance with applicable Canadian securities laws and will be available under SouthGobi's profile on SEDAR at www.sedar.com.

For more information, or to obtain a copy of the early warning report to which this press release relates, please contact:
Dean Wang
Director
Novel Sunrise Investments Limited
P.O. Box 957, Offshore Incorporation Centre
Road Town, Tortola
British Virgin Islands VG1110.
Telephone No: +852 6218 0511
Email: dean@novelsunrise.com

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