Hong 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 Bank of Canada exchange rate of one Canadian dollar to US$0.7069. On that basis, the Assigned PIK Interest would entitle Od Sar to receive approximately 82,144,401 Common Shares.

Assuming 297,051,666 Common Shares outstanding immediately prior to issuance of such shares and no other changes to the Issuer's capital structure, the issuance of 82,144,401 Common Shares to Od Sar would result in 379,196,067 Common Shares being issued and outstanding, and the Common Shares issuable to Od Sar would represent approximately 21.66% of the then issued and outstanding Common Shares of SouthGobi on an undiluted basis.

Immediately prior to the Assignment, Od Sar did not beneficially own or control any issued and outstanding Common Shares of SouthGobi. Immediately following the Assignment, Od Sar continued not to beneficially own or control any issued and outstanding Common Shares of SouthGobi. However, following completion of the Assignment, Od Sar acquired the Assigned PIK Interest and the right to receive the Common Shares issuable in respect thereof.

Od Sar acquired the Assigned PIK Interest for investment purposes and demanded payment of US$17,000,000 of the Assigned PIK Interest on July 12, 2026, Pacific Time. Subject to the terms of the Convertible Debenture and related agreements, Od Sar expects to receive 73,497,622 Common Shares in satisfaction of US$17,000,000 of the Assigned PIK Interest, representing approximately 19.83% of the issued and outstanding Common Shares of SouthGobi on an undiluted basis. Following such issuance of Common Shares, Od Sar may evaluate its investment from time to time and may increase or decrease its interest in securities of SouthGobi through market transactions, private agreements or otherwise, including demanding further payment of the remaining balance of the Assigned PIK Interest.

An early warning report containing additional information regarding the foregoing matters will be filed by Od Sar under National Instrument 62-103 under SouthGobi's profile on SEDAR+. A copy of the early warning report may be obtained by contacting Od Sar at the address below.

About Od Sar Trading Co., Limited

Od Sar Trading Co., Limited is a company incorporated under the laws of Hong Kong. Its registered office is:

Unit D01, 3/F, Wong King Industrial Building

No. 2 Tai Yau Street

Hong Kong

Forward-Looking Information

This news release contains forward-looking information, including statements regarding Od Sar's intention to demand payment of the Assigned PIK Interest, the number of Common Shares that may be issuable upon payment of the Assigned PIK Interest, and Od Sar's future intentions with respect to SouthGobi. Forward-looking information is based on assumptions and is subject to risks and uncertainties, many of which are beyond Od Sar's control. Actual results may differ materially from those expressed or implied by such forward-looking information. Od Sar undertakes no obligation to update any forward-looking information except as required by applicable law.

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