SouthGobi Announces Discloseable and Connected Transaction Deferral of Payment Obligation Under Prior Deferral Agreement - Seite 2

The Deferral

JDZF agrees to grant the Company a deferral (the "Deferral") of the Deferred Amounts until August 31, 2025 (the "Deferral Date").

As consideration for the deferral of the Deferred Amounts, the Company agrees to pay JDZF a deferral fee equal to 6.4% per annum on the outstanding balance of such Deferred Amounts (the "Deferral Fees"), commencing on the date on which each such Deferred Amounts would otherwise have been due and payable under the Convertible Debenture.

The April 2024 Deferral Agreement does not contemplate a fixed repayment schedule for the Deferred Amounts or related deferral fees. Instead, the April 2024 Deferral Agreement requires the Company to use its best efforts to pay the Deferred Amounts and related deferral fees due and payable under the April 2024 Deferral Agreement to JDZF. During the period beginning as of the effective date of the April 2024 Deferral Agreement and ending as of the Deferral Date, the Company will provide JDZF with monthly updates of its financial status and business operations, and the Company and JDZF will, on a monthly basis, discuss and assess in good faith the amount (if any) of the Deferred Amounts and related deferral fees that the Company may be able to repay to JDZF, having regard to the working capital requirements of the Company's operations and business at such time and with the view of ensuring that the Company's operations and business would not be materially prejudiced as a result of any repayment.

If at any time before the Deferred Amounts and related deferral fees are fully repaid, the Company proposes to appoint, replace or terminate one or more of its chief executive officer, its chief financial officer or any other senior executive(s) in charge of its principal business function or its principal subsidiary, the Company will first consult with, and obtain written consent (such consent shall not be unreasonably withheld) from JDZF prior to effecting such appointment, replacement or termination.

The occurrence of a Deferral Event of Default or an Event of Default (as such term is defined in the Convertible Debenture) will: (i) entitle JDZF to pursue any and all remedies against the Company and the Guarantors in accordance with the Convertible Debenture; and (ii) result in the principal, interest and other amounts owing under the April 2024 Deferral Agreement, the Convertible Debenture and related security agreements becoming immediately due and payable without any requirement for JDZF to deliver notice to the Company.