Mr. John Lee reports

PROPHECY RECEIVED APPROXIMATELY $2.34 MILLION FROM EQUIPMENT SALES

Further to Prophecy Development Corp.'s news release dated May 14, 2015, the company, through its wholly owned subsidiary Red Hill Mongolia LLC, has closed the sale of substantially all of its mining and transportation equipment from the company's Ulaan Ovoo mine and received a total of 3,707,542,000 Mongolian tugriks (equivalent to approximately $2.34-million, based on today's exchange rate of $1 to 1,584 Mongolian tugriks). The buyer chose not to purchase a few pieces of equipment which accounts for the slight difference of approximately $60,000 between the proceeds and the original contract value announced.

The company received consent for the sale of the equipment from its creditor, Linx Partners Ltd., which holds a general security interest over the company's assets (including those held by subsidiaries). In consideration, John Lee, the beneficial owner of Linx, who is also a director and officer of the company, received 12 million share purchase warrants of the company exercisable at five cents per common share for a period of five years from the date of issuance.

The proceeds will be used to repay the company's existing loan from Trade and Development Bank of Mongolia, and to advance the company's Chandgana mine mouth power plant and Pulacayo silver-zinc-lead projects.

We seek Safe Harbor.