SolGold Regulatory News (SOLG)

28 September 2016

SolGold plc

("SolGold" or the "Company")

Letter to Shareholders

The Board of Directors of SolGold Plc (SolGold, AIM: SOLG) advise that the following letter is in the process of being despatched to shareholders regarding the Company's upcoming General Meeting, scheduled for 13 October 2016.

Dear Shareholder

By now you will have received the meeting materials for the General Meeting of Shareholders called by the SolGold Board for 13 October 2016 to deal with three separate resolutions, namely:

1. Resolution 1 which will seek authorisation for the Directors to allot and issue shares in the Company (or grant rights to subscribe for or to convert any securities into shares in the Company) up to an aggregate nominal amount of £6,000,000, for a period of up to 15 months.

2. Resolution 2 which originally proposed to approve the terms upon which Newcrest International Pty Ltd (Newcrest International) was to invest USD10,868,592 for 10% of the issued share capital of SolGold at a price of US8 cents per share, pursuant to the terms of a Share Subscription Agreement executed by Newcrest International, Newcrest Mining Ltd and SolGold on 30 August 2016.

3. Resolution 3 which will seek authorization to disapply the statutory pre-emption rights to existing holders in relation to the issuance of new securities which are the subject of Resolution 1, for a period of up to 15 months.

Full details are outlined in the meeting materials dated 16 September 2016.

As a result of recent developments in relation to the proposed subscription by Newcrest International, as outlined in the Company's market releases of 22 and 26 September 2016, Resolution 2 to be put to shareholders at the General Meeting will be amended by the Chairman at the General Meeting to read as follows:

Resolution 2

That subject to the passing of Resolutions 1 and 3, the Company approve the issue and allotment to Newcrest International of 142,896,661 new ordinary shares in the Company at a price of USD16 cents (approximately 12 pence) each and otherwise on the terms of the Share Subscription Agreement.

The SolGold Board of Directors has unanimously approved the proposed transaction with Newcrest International, and substantial shareholders Maxit Capital LLP and DGR Global Ltd have also provided in-principle approval for the proposed transaction, subject to there being no superior proposal being made to SolGold by an independent bona fide third party for in excess of 5% of the share capital of SolGold, prior to SolGold shareholder approval being obtained.

Other shareholders representing the private interests of CEO and Managing Director Mr Nicholas Mather have approved the proposed transaction unconditionally.

Any shareholders having already lodged proxy votes that wish to change their votes may do so by downloading a new proxy form from the meeting materials which appear on the Company's website (www.solgold.com.au) and sending same to the Company Secretary (kschlobohm@solgold.com.au) noting it as a "replacement proxy".

Yours sincerely

Karl Schlobohm

Company Secretary

SolGold Plc

Contacts:

Mr Nicholas Mather Tel: +61 (0) 7 3303 0665

SolGold Plc (Executive Director) +61 (0) 417 880 448

nmather@solgold.com.au 

Mr Karl Schlobohm Tel: +61 (0) 7 3303 0661

SolGold Plc (Company Secretary)

kschlobohm@solgold.com.au 

Mr Ewan Leggat / Richard Morrison Tel: +44 (0) 20 3470 0470

SP Angel Corporate Finance LLP (NOMAD and Broker)

Ewan.leggat@spangel.co.uk / richard.morrison@spangel.co.uk 

Follow us on twitter @SolGold_plc

NOTES TO EDITORS

SolGold is a Brisbane, Australia based, AIM‐listed (SOLG) copper gold exploration and development company with assets in Ecuador, the Solomon Islands and Australia. The Company's primary objective is to discover and define world‐class copper‐gold deposits. SolGold's Board and Management Team have substantial vested interests in the success of Company, as well as strong track records in the areas of exploration, mine development, investment, finance and law. SolGold's experience is augmented by state of the art geophysical and modelling techniques and the guidance of Newmont trained porphyry expert Dr Steve Garwin.

From a corporate perspective, SolGold has recently announced capital raisings involving Maxit Capital LP and Newcrest International Ltd, both undertaken at substantial premiums to previous raisings. Once completed, SolGold will have raised USD48 million in funding to continue the exploration and development of its flagship Cascabel Project. Also as a result of these raisings, Mr Scott Caldwell (CEO of TSX-listed Guyana Goldfields Inc) joined the SolGold Board on 9 September 2016. Mr Caldwell is a mining engineer with over 30 years of experience building and operating gold and base metal mines worldwide, including USA, Canada, Russia, Zimbabwe, Chile and Indonesia.

Cascabel, the Company's world class flagship copper‐gold porphyry project, is located in North West Ecuador on the under‐explored northern section of the richly endowed Andean Copper Belt. SolGold owns 85% of Exploraciones Novomining S.A. ("ENSA") and approximately 11% of TSX‐V‐listed Cornerstone Capital Resources, which holds the remaining 15% of ENSA, the Ecuadorian registered company which holds 100% of the Cascabel concession.

To date SolGold has completed geological mapping, 25km2 of soil sampling, 14km2 and an additional 9km2 Induced Polarisation and Magnetotelluric "Orion" surveys over the Alpala cluster and Aguinaga targets respectively. By June 2016, the Company had also completed approximately 23,700m of drilling and expended a total of approximately USD33m on the program, corporate costs and investments into Cornerstone. Intense diamond drilling is planned for the next 12 months with multiple drill rigs.

Cascabel is characterised by fourteen (14) identified targets, world class drilling intersections over 1km in length, and high copper and gold grades, as well as logistic advantages in location, elevation, water supply, proximity to roads, port and power services and a progressive legislative approach to resource development in Ecuador. To date, SolGold has drill tested only one of the 14 targets, being Alpala.

SolGold is planning a resource statement at Alpala (the most advanced target at Cascabel) during 2016. This has been delayed by the discovery of high-grade mineralisation in Hole 17 at Alpala, extending the immediate resource potential. Alpala is open at depth in the upper extensions, and to the north, north-east, south-west and south-east. The mineralised zone at Alpala and Moran is closely modelled by magnetic signatures and currently encompasses over 10Bt of magnetic rocks expected to be mineralised with copper and gold.

SolGold will drill test other key targets within the Cascabel concession at Aguinaga, Trivinio, Moran, Alpala Northwest, Hematite Hill, Alpala Southeast, Cristal, Parambas, Carmen Tandayama-America and Chinambicito. The Company is planning further metallurgical testing by the end of 2016, and completion of a conceptual early stage mine and plant design and a scoping study for an economic development at Cascabel. SolGold is investigating both high tonnage / low-medium grade open cut and underground block caving operations, and a high grade / low tonnage underground development.

Drill hole intercepts are calculated using a data aggregation method, defined by copper equivalent cut-off grades and reported with up to 10m internal dilution, excluding bridging to a single sample. Copper equivalent grades are calculated using a gold conversion factor of 0.89, determined using copper price of USD2.20/pound and gold price of USD1350/ounce.

Following a comprehensive review of the geology and prospectivity of Ecuador, SolGold and its subsidiaries have also applied for additional exploration licences in Ecuador over a number of additional promising porphyry copper gold targets elsewhere in the Country.

In Queensland, Australia the Company is evaluating the future exploration plans for the Mt Perry, Rannes and Normanby projects. Joint venture agreements are being investigated for a joint venture partner to commit funds and carry out exploration to earn an interest in the tenements.

SolGold retains interests in its original theatre of operations, the Solomon Islands in the South West Pacific, where the 100% owned, as yet undrilled, Kuma prospect exhibits surface geological characteristics which are traditionally indicative of a large metal rich copper gold intrusive porphyry system. SolGold intends in the future to apply intellectual property and experience developed in Ecuador to target additional world class copper gold porphyries at Kuma and other targets in Ecuador and Argentina.

SolGold is based in Brisbane, Queensland, Australia. The Company listed on London's AIM Market in 2006, under the AIM code 'SOLG' and currently has a total of 1,222,716,605 ordinary shares issued, together with 2,180,000 options exercisable at 28p and 5,180,000 options exercisable at 14p.

CAUTIONARY NOTICE

The news release may contain certain statements and expressions of belief, expectation or opinion which are forward looking statements, and which relate, inter alia, to the Company's proposed strategy, plans and objectives or to the expectations or intentions of the Company's directors. Such forward-looking statements involve known and unknown risks, uncertainties and other important factors beyond the control of the Company that could cause the actual performance or achievements of the Company to be materially different from such forward-looking statements. Accordingly, you should not rely on any forward-looking statements and save as required by the AIM Rules for Companies or by law, the Company does not accept any obligation to disseminate any updates or revisions to such forward-looking statements.