Mr. Ryan Kalt reports

DIXIE GOLD INC. -- DISCLOSURE UPDATE TO PREVIOUSLY ANNOUNCED TAKEOVER TRANSACTION

Dixie Gold Inc. has provided an event-related disclosure update to its previously announced transaction with Australian Securities Exchange listed Omnia Metals Group Ltd. (see news release dated Oct. 27, 2023).

On Dec. 22, 2023, the corporation was advised by Omnia that Omnia had received response of same date from its listed exchange (the Australian Securities Exchange), pertaining to in-principle advice regarding the suitability of Omnia for readmission to its official list if the takeover transaction were to be consummated. The corporation expects the in-principle advice to allow Omnia to undertake further actions with respect to progressing the previously announced terms of the takeover transaction involving Omnia and the corporation. The corporation necessarily cautions that the in-principle advice is not a guarantee of readmission for Omnia, that the in-principle advice is subject to certain conditions, and that the in-principle advice does not constitute irrevocable, definitive or final ASX approval as relating to matters under the takeover transaction.

Based on continuing mutual effort by the parties to advance the takeover transaction to its intended completion, the corporation has entered into an amending letter also dated Dec. 22, 2023, with Omnia, whereby the parties have increased the duration of the exclusivity period by an additional four-week period (see also the corporation's news release of Oct. 27, 2023). The exclusivity period extension, which was entered into subsequent to the in-principle advice being received, is expected to allow the parties, among other practical and ordinary-course attributes, to continue to work on customary matters that remain outstanding or incomplete and as may otherwise relate to the takeover transaction and the parties' intent to pursue completion of the same on the terms previously announced. There was no additional consideration paid by Omnia to the corporation in relation to the exclusivity period extension. The corporation highlights note disclosure from its recent interim financial statements (as available on SEDAR+) that the initial upfront exclusivity fee was received by the corporation from Omnia as prescribed under the terms of the takeover transaction (see also the corporation's news release of Oct. 27, 2023).

Following the in-principle advice, the corporation is advised by Omnia that Omnia is expected, in the near future, to disseminate a news release announcing the transaction on part of Omnia, the transaction of which was first announced by the corporation (see news release dated Oct. 27, 2023), the corporation having been subject to different disclosure timeline requirements and regulations than Omnia. Interested parties may follow announcements by Omnia through Omnia's profile page on the ASX website.

To the best knowledge of the corporation, Omnia is to remain under regulatory halt, as first requested by Omnia, and, further to the best knowledge of the corporation, is expected to remain under such halt condition in the full period leading to one form of finality or another as relates to the takeover transaction and Omnia's potential resumption/readmission, as circumstances apply, thereafter.

Subject to all necessary approvals and as previously disclosed (see news release dated Oct. 27, 2023), it is anticipated that the takeover transaction would be implemented through a plan of arrangement under provisions of the Business Corporations Act (British Columbia), whereby the corporation would, if the matter is successfully completed, become a wholly owned subsidiary of Omnia.

The corporation continues to work diligently with Omnia having an objective to consummate the takeover transaction, subject to all necessary approvals, during the first half of 2024. The corporation is supportive of any financing pursuits that Omnia may elect to undertake to advance its corporate standing, inclusive of funds that Omnia may pursue to satisfy the cash consideration component of the takeover transaction.

The takeover transaction remains subject to various conditions customary in transaction matters of this kind, including, without limitation, receipt of all necessary regulatory approvals, shareholder approvals, court approval(s) and the entering into of an arrangement agreement.

Further materials and details related to the takeover transaction shall be forthcoming to shareholders in the anticipated ordinary course or, if applicable, as/when pertinent developments like those outlined herein occur.

Subject to certain precondition(s), the corporation presently expects to call a shareholder meeting to seek its shareholder approval for the takeover transaction during the first quarter of 2024.

The corporation wishes to extend its appreciation to the management, directors and advisers of Omnia for their work to date pertaining to the takeover transaction.

About Dixie Gold Inc.

Dixie Gold is a publicly traded exploration company holding a portfolio of exploration projects in Canada.

We seek Safe Harbor.