CITIGOLD CORPORATION LIMITED - Proxy Solicitation & Information Statement 2013

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ANNOUNCEMENT

Notice of Meeting

4 June 2013: Brisbane, Australia – Citigold Corporation Limited (“Citigold” or “Company”) (ASX:CTO, FSE:CHP) advises that the Extraordinary General Meeting of Citigold Corporation Limited to be held on Monday, 8 July 2013 at 10.00am in the Burdekin Room, Mercure Townsville, 166-194 Woolcock Street, Townsville, Queensland 4810, Australia.

This meeting will present you the opportunity to vote on this company’s $100 million transformational funding opportunity that gives us the catalyst to successfully exploit the impressive gold deposit at Charters Towers.

The Notice of Meeting herewith, includes the Explanatory Notes, Independent Expert Report and Proxy Form, and will be mailed out to all shareholders.

To assist shareholders who can’t attend the General Meeting and wish to vote on the resolution to be considered, your Proxy Form must be received by 12.00pm on Friday, 5 July 2013.

If you plan to attend the meeting, please bring along the proxy form that is mailed out to you to facilitate with registration which will commence at 9.30am.

Your directors and the management of Citigold look forward to seeing you.

Yours sincerely

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Mark Lynch CEO/Managing Director +61 (0)7 3834 000

Cautionary Note: This release may contain forward-looking statements that are based upon management’s expectations and beliefs in regards to future events. These statements are subjected to risk and uncertainties that might be out of the control of Citigold Corporation Limited and may cause actual results to differ from the release. Citigold Corporation Limited takes no responsibility to make changes to these statements to reflect change of events or circumstances after the release.

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Citigold Corporation Limited Level 13, 500 Queen Street, Brisbane QLD 4000 Australia Tel:+61 (0)7 3834 0000 Fax:+61 (0)7 3834 0011 www.citigold.com

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CITIGOLD CORPORATION LIMITED NOTICE OF EXTRAORDINARY GENERAL MEETING AND EXPLANATORY STATEMENT

Extraordinary General Meeting to be held at Burdekin Room, Mercure Townsville, 166-194 Woolcock Street, Townsville, Queensland 4810 on Monday 8 July, 2013 commencing at 10am (AEST).

This Notice of Extraordinary General Meeting ( Notice ) and Explanatory Statement ( Explanatory Statement ) should be read in its entirety. If shareholders are in doubt as to how they should vote, they should seek advice from their accountant, solicitor or other professional adviser without delay.

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Corporate Directory

Company Citigold Corporation Limited ABN: 30 060 397 177 ASX Code: ‘CTO’ Directors Mr John Foley (Non Exec. Chairman) Mr Mark Lynch (Managing Director) Dr Brian White (Executive Director) Mr Matthew Gill (Non Exec. Director) Mr Kim Koh (Non Exec. Director) Mr Satish Panchariya (Non Exec. Director) Mr Raymond Tan (Non Exec. Director) Company Secretary Mr Matthew Martin Registered Office Level 13, 500 Queen Street, Brisbane, Queensland 4000 Website www.citigold.com Auditors KS Black & Co Chartered Accountants Level 6 350 Kent Street Sydney QLD 2000 Legal Advisers Hemming+Hart Lawyers Level 5 307 Queen Street BRISBANE QLD 4000 Share Registry Computershare Investor Services Limited 117 Victoria Street WEST END QLD 4101

Citigold Corporation Limited – Notice of General Meeting

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NOTICE OF GENERAL MEETING

Notice is hereby given that an Extraordinary General Meeting of shareholders of Citigold Corporation Limited ( Citigold or the Company ) will be held at Burdekin Room, Mercure Townsville, 166-194 Woolcock Street, Townsville, Queensland 4810 on Monday 8 July, 2013 at 10am (AEST).

To consider and, if thought fit, to pass without amendment the following resolution as an ordinary resolution:

1. Approval of the issue of Convertible Bonds and Shares upon Conversion of the Converting Bonds, to Express-Link Management Limited

“That in accordance with item 7 of section 611 of the Corporations Act and for all other purposes, approval is given for the Company to issue to Express-Link Management Limited:

(a) up to 100 Convertible Bonds, each having a subscription price and face value of $1 million; and
(b) upon Conversion of the Convertible Bonds, such number of Shares required for Conversion of those Convertible Bonds as determined in accordance with the Funding Agreement,

on the terms and conditions described in the Explanatory Statement.”

Voting Exclusion

The Company will disregard any votes cast on this Resolution 1 by Express-Link Management Limited and any associate. The Company need not disregard a vote if it is cast by a person as proxy for a person who is entitled to vote, in accordance with the directions on the proxy form or it is cast by the person chairing the Meeting as a proxy for the person who is entitled to vote, in accordance with the directions on the proxy form to vote as the proxy decides.

NOTES

These notes form part of the Notice of Meeting.

Time and place of meeting

Notice is given that a general meeting of members will be held at Burdekin Room, Mercure Townsville, 166-194 Woolcock Street, Townsville, Queensland 4810 on Monday 8 July, 2013 at 10am AEST.

Your vote is important

The business of the general meeting affects your shareholding and your vote is important.

Voting eligibility

The Directors have determined pursuant to Regulation 7.11.37 of the Corporations Regulations 2001 (Cth) that the persons eligible to vote at the Meeting are those who are registered Shareholders at 7pm on Thursday 4 July 2013.

Voting in person

To vote in person, attend the general meeting at the time, date and place set out above.

Voting by proxy

To vote by proxy, please complete and sign the enclosed Proxy Form and return by the time and in accordance with the instructions set out on the Proxy Form.

In accordance with section 249L of the Corporations Act, members are advised that:

(a) each member has a right to appoint a proxy;
(b) the proxy need not be a member of the Company; and
(c) a member who is entitled to cast 2 or more votes may appoint 2 proxies and may specify the proportion or number of votes each proxy is appointed to exercise. If the member appoints 2 proxies and the appointment does not specify the proportion or number of the member’s votes, then in accordance with section 249X(3) of the Corporations Act, each proxy may exercise one-half of the votes.

New sections 250BB and 250BC of the Corporations Act came into effect on 1 August 2011 and apply to voting by proxy on or after that date. Shareholders and their proxies should be aware of these changes to the Corporations Act, as they will apply to this Meeting. Broadly, the changes mean that:

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(a) if proxy holders vote, they must cast all directed proxies as directed; and

(b) any directed proxies which are not voted will automatically default to the Chair, who must vote the proxies as directed.

Further details on these changes are set out below.

Proxy vote if appointment specifies way to vote

Section 250BB(1) of the Corporations Act provides that an appointment of a proxy may specify the way the proxy is to vote on a particular resolution and, if it does:

(c) the proxy need not vote on a show of hands, but if the proxy does so, the proxy must vote that way (i.e. as directed); and
(d) if the proxy has 2 or more appointments that specify different ways to vote on the resolution – the proxy must not vote on a show of hands; and
(e) if the proxy is the chair of the meeting at which the resolution is voted on – the proxy must vote on a poll, and must vote that way (i.e. as directed); and
(f) if the proxy is not the chair – the proxy need not vote on the poll, but if the proxy does so, the proxy must vote that way (i.e. as directed).

Transfer of non-chair proxy to chair in certain circumstances

Section 250BC of the Corporations Act provides that, if:

(a) an appointment of a proxy specifies the way the proxy is to vote on a particular resolution at a meeting of the Company's members; and
(b) the appointed proxy is not the chair of the meeting; and
(c) at the meeting, a poll is duly demanded on the resolution; and
(d) either of the following applies:
(i) the proxy is not recorded as attending the meeting;
(ii) the proxy does not vote on the resolution,

the chair of the meeting is taken, before voting on the resolution closes, to have been appointed as the proxy for the purposes of voting on the resolution at the meeting.

Voting by corporate representative

A body corporate that is a Shareholder, or that has been appointed as a proxy, may appoint an individual to act as its representative at the general meeting. The appointment must comply with the requirements of section 250D of the Corporations Act. The representative should bring to the general meeting, evidence of appointment, including any authority under which it is signed, unless it has previously been given to the Company.

Voting by attorney

A Shareholder may appoint an attorney to vote on their behalf. For an appointment to be effective for the General Meeting, the instrument effecting the appointment (or a certified copy of it) must be received by the Company in one of the methods listed above for the receipt of Proxy Forms, so that it is received not later than 12 noon on Friday 5 July 2013.

Forward looking statements

Certain statements in this Explanatory Statement relate to the future. These statements reflect views only as of the date of this Explanatory Statement. While the Company believes that the expectations reflected in the forward looking statements are reasonable, neither the Company nor any other person gives any representation, assurance or guarantee that the occurrence of an event expressed or implied in any forward looking statements in this Explanatory Statement will actually occur.

Notice to persons outside Australia

This Explanatory Statement has been prepared in accordance with Australian laws, disclosure requirements and accounting standards. These laws, disclosure requirements and accounting standards may be different to those in other countries.

The distribution of this Explanatory Statement may, in some countries, be restricted by law or regulation. Accordingly, persons who come into possession of this Explanatory Statement should inform themselves of, and observe, any such restrictions.

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Disclaimers

No person is authorised to give any information or make any representation in connection with the Transaction which is not contained in this Explanatory Statement. Any information or representation not contained in this Explanatory Statement, may not be relied on as having been authorised by the Company or the Board in connection with the Transaction.

Privacy

To assist the Company to conduct the General Meeting, the Company may collect personal information including names, contact details and shareholding of Shareholders and the names of persons appointed by Shareholders to act as proxy at the General Meeting. Personal information of this nature may be disclosed by the Company to its share registry, print and mail service providers, and the Company's agents for the purposes of implementing the Transaction. Shareholders have certain rights to access their personal information that has been collected and should contact the Company Secretary if they wish to access their personal information.

Responsibility for information

The information contained in this Explanatory Statement (except for the Independent Expert’s Report and information regarding Express-Link and its intentions) has been prepared by the Company and is the responsibility of the Company. Express-Link assumes no responsibility for the accuracy or completeness of that information. Information concerning Express-Link and its intentions has been provided by Express-Link. None of the Company, its associates or its advisers assumes any responsibility for the accuracy or completeness of that information.

BDO has prepared the Independent Expert’s Report and has consented to the inclusion of the report, and references to it, in this Explanatory Statement. BDO takes responsibility for that report, and references to it, but is not responsible for any other information contained within this Explanatory Statement.

Shareholders are urged to read the Independent Expert’s Report carefully to understand the scope of the report, the methodology of the assessment, the sources of information and the assumptions made.

Competent Person consent statement

The information in this report that relates to exploration results is based on information compiled by Christopher Towsey, who is a Member of the Australasian Institute of Mining and Metallurgy. Christopher Towsey has sufficient experience which is relevant to the style of mineralisation and type of deposit under consideration and to the activity which he is undertaking to qualify as a Competent Person as defined in the 2004 Edition of the ‘Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves.’ Mr Christopher Towsey consents to the inclusion in this report of the matters based on his information in the form and context in which it appears.

ASIC and ASX involvement

A copy of the Notice of Meeting and Explanatory Statement has been lodged on 3 June 2013 with ASIC pursuant to ASIC Regulatory Guide 74 and ASX pursuant to the Listing Rules. Neither ASIC, ASX nor any of their officers take any responsibility for the contents of the Notice of Meeting and Explanatory Statement.

By Order of the Board of Directors

Matthew Martin Company Secretary Citigold Corporation Limited 3 June 2013

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Letter from Chairman

Dear Shareholder,

On behalf of the Board, I am pleased to present you the opportunity to vote on this company’s transformational funding opportunity in an environment of uncertain global economic outlook and tight capital markets.

Your Board is recommending that you approve the transaction that has been negotiated between Express-Link Management Limited (Express-Link) and Citigold Corporation Limited (“Citigold” or the “Company”), wherein the Company will raise $100 million through the issue of 100 convertible bonds with a conversion price of 7 cents per share.

I am recommending that you vote YES to this proposed transaction at the upcoming meeting of shareholders. This deal is an important step in achieving our simple objective of restoring value for all of our shareholders.

As always, in attempting to grow any mining operation outside of its existing constraints, there is an upfront need for working capital, development expenditure and fixed capital prior to the beginning of the opportunity. Then, the revenue follows from the growth in gold ounces, increased profitability and generation of exceptional cash flow which is anticipated. Like all of these plans, it requires a significant working capital uplift and a sizeable development budget, including increased reserve definition expenditure, grade control drilling and mine development, followed by further fixed capital investment in enlarged processing capacity. This process therefore does reshape the size and shape of the Company you are invested in, considerably.

This investment further confirms the underlying value and future potential of the Charters Towers Project. The deal is about the bigger, longer term picture and not focussed just on the now. The discount reflects the reality of securing an investment of this size in the current environment.

However, you would all be aware, that in order to get something you need to give up something. In this case, the objective sought by Express-Link was the ability to obtain a significant interest in Citigold. The serious level of funding that this proposal delivers, would by any investor’s assessment, require a level of ownership to put them in a position to assess how things are going and to be directly involved.

I and the rest of your Board recommend this transaction to you (subject to no superior proposal arising) as a sound and best way forward for Citigold and its current shareholders. We also ask you to support the Express-Link proposal with a YES vote.

We look forward to continuing along this path together and promise you that we are giving our all for the success of your Citigold.

Yours Sincerely,

John Foley Chairman of the Board

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EXPLANATORY STATEMENT

This information forms part of the Notice of General Meeting.

This Explanatory Statement has been prepared for the information of shareholders in relation to the business to be conducted at the Company’s Extraordinary General Meeting ( Meeting ) convened at Burdekin Room, Mercure Townsville, 166-194 Woolcock Street, Townsville, Queensland 4810 on Monday 8 July, 2013 at 10am (AEST).

The Explanatory Statement provides information that the Directors believe to be material to Shareholders in deciding whether or not to pass the Resolutions contained in the Notice of Meeting.

The Notice of Meeting, Explanatory Statement, Independent Expert’s Report and Proxy Form are all important documents. They should be read carefully in their entirety before you make a decision on how to vote at the general meeting.

If you have any questions regarding the matters set out in the documents, please contact the Company Secretary on+61 7 3834 0000. You should also contact your accountant, lawyer or other professional adviser.

Key dates

The key dates associated with the General Meeting and this document are set out below:

Table 1:

Event	Date
Date of Notice of Meeting	3 June 2013
Completed Proxy Forms to be received	12 noon AEST 5 July 2013
Date and time for determining eligibility to attend and vote at General Meeting	7pm AEST 4 July 2013
General Meeting of Shareholders	10am AEST 8 July 2013

Definitions

Capitalised terms used in this Explanatory Statement are defined in section 8.

Who is Express-Link?

Express-Link Management Ltd (Express-Link) is a company controlled by its sole Director, Mr Ooi Cheu Kok who resides in Malaysia and is a Malaysian citizen. Mr Ooi Cheu Kok manages Express-Link Management Ltd from Malaysia. Mr Ooi Cheu Kok is a veteran of the investing community in his home country, Malaysia, as well as in South East Asia, Mr Ooi started off as a real-estate developer. In 1988, Mr Ooi graduated from La Trobe University (Melbourne, Australia) with a Bachelor of Economics (Accounting). Mr Ooi founded Golden Wave Sdn Bhd, a billiondollar commercial development project in Kota Kinabalu, East Malaysia. Mr Ooi was instrumental in developing the concept with the local government authorities.

Mr Ooi is a high net worth individual. One of his most significant and recent investment is his holdings in SGX (Singapore mainboard listed) company Blumont Group Ltd (SGX.A33) which has a market capitalisation of SGD$1.36 billion as at 2 May 2013 (approximately AUD$1.121 billion as at 3 June 2013). Mr Ooi is currently the second largest shareholder in Blumont Group Ltd and holds 169,118,000 shares in the company. The stock recently trade at SGD0.83 per share (approximately AUD0.68 per share as at 3 June 2013), making the total value of his Blumont shares at SGD$140,367,940 (approximately AUD$115,746,321 as at 3 June 2013).

His other holdings include projects in Sabah; residential developments in KolKol and Tenom, and a sea front resort in Marudu, and the Centrepoint Shopping Centre in Kota Kinabalu.

Since 2010, Mr Ooi has ventured from real property development to investing in public and private equities in Asia. Most significant and recent is his holdings in SGX (Singapore mainboard listed) company Blumont Group (market cap SGD$1.36 billion as at 2 May 2013). Mr Ooi holds a substantial stake in the Blumont Group and is its second largest shareholder.

Blumont Group Ltd operates an investment holding business (including equity investments) and a real property development and management business. In March 2013, Blumont acquired an 11.6% interest in Celsius Coal Ltd (ASX:CLA).

Prior to the current transaction, there were no existing interests or relationship between Express-Link and the Company. The Company began its relationship with Express-Link when Mr Ooi approached the Company.

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sole director of Express-Link is Mr Ooi Cheu Kok. Express-Link does not have any other Australian operations as at the date of this Notice.

Shareholders should note that Express-Link, incorporated in the British Virgin Islands, is not subject to the same requirements as Australian companies. Accordingly, Shareholders of the Company may not be able to obtain the same information about internationally incorporated Express-Link, and its operations, that they may be able to obtain about domestic Australian incorporated companies.

Express-Link’s major activities are investment, and, accordingly, Express-Link has decided to invest in the Company as part of its investment strategy.

Express-Link has advanced an initial amount of $3,000,000 to the Company for the initial tranche of bonds. It is proposed that required funding for the remaining tranches (totaling $97,000,000) payable by Express-Link over a 21 month period under the Funding Agreement will be facilitated by its shareholder, Mr Ooi, either as a capital contribution or loan to Express-Link. Mr Ooi is a high net worth individual and has numerous other investments and property holdings in Asia.

Express-Link's intentions

This section sets out Express-Link's stated intentions, on the basis of the facts and information concerning the Company that are known to it and the existing circumstances affecting the business of the Company.

(a) Review

Express-Link and its advisers have reviewed certain information that has been publicly released on the Company, its current activities and its plans for the future, and had certain limited discussions with the Company in relation to its businesses.

However, Express-Link does not necessarily have knowledge of all material information, facts and circumstances that are necessary to assess the operational, commercial, taxation and financial implications of its current intentions. Consequently, final decisions on all of these matters have not been made, and any decisions already made may be subject to change.

If Express-Link subscribes for and Converts the Convertible Bonds, Express-Link may, to the extent that information is available to it, conduct a review of the operations, assets, structure and employees of the Company in light of that information. Final decisions will only be reached after that review and in light of all material facts and circumstances. As such, statements referred to in this section are statements of current intention only which may change as new information becomes available or circumstances change. The statements referred to in this section 3 should be read in this context.

(b) Intentions

Express-Link's current intentions (if the Funding Agreement is approved and completed) are for the Company to commence ramping up of its Imperial and Central mine projects as soon as practical, on a sustainable basis and to maximise the value of the Company for all Shareholders over the long term.

Except for the changes and intentions referred to in this section 3.1 and elsewhere in this Explanatory Statement, Express-Link indicates that it intends, based on the information presently known to it:

(i) to continue the business of the Company as it is currently conducted (subject to implementing the development programme set out in section 1.3);
(ii) not to make any major changes to the business of the Company or the deployment of the Company's assets;
(iii) not to transfer any Company property between the Company and Express-Link or any person associated with Express-Link;
(iv) not intend to acquire any additional shares in the Company on-market during the term of the Bonds;
(v) to continue the employment of the Company's existing Employees;
(vi) not to interfere with the Company maintaining a strong Board that operates independently of, and separately to, Express-Link; and
(vii) not to significantly change the financial or dividend distribution policies of the Company.

Express-Link has the right to convert the Convertible Bonds and, as explained elsewhere in this Explanatory Statement, Express-Link may be placed in a position of control over the Company under certain scenarios if ExpressLink converts all of the Convertible Bonds.

Before Express-Link can Convert the Convertible Bonds, a number of conditions must be satisfied, including Shareholder approval under this Notice of Meeting, appropriate disclosure to ensure there are no restrictions on Express-Link’s ability to sell its Convertible Bonds, Express-Link having obtained FIRB approval (Citigold is advised that the FIRB Approval obtained by Express-Link covers all subscription tranches and is valid until 15 May 2015) and any other regulatory approvals that apply (if any) and there being no material adverse change in relation to the Company, including the Company remaining listed on ASX.

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If Express-Link were to gain effective control of the Company, subject to the Corporations Act and the Company’s constitution, Express-Link would have the ability to appoint a majority of the Directors on the Company’s Board.

The Company currently has seven directors on its Board. Mr Ooi, the sole Director and shareholder of Express-Link has advised that he is intending to appoint one non-executive Director to the Board, who would be an additional Director but that no other changes are intended.

Mr Ooi does not intend to be personally engaged in running the Company, and, other than the appointment of the additional non-executive Director referred to above, Express-Link does not intend to make changes to the senior management of the Company and does not intend to appoint any employees to the Company. Mr Ooi believes that appointments of senior management personnel and employees are matters for the management of the Company.

If the Company were to become a partly owned subsidiary of Express-Link, the implementation of any change Express-Link intends to make to the objectives and goals of the Company (which Express-Link has not currently identified) will be subject to:

(i) the law and the ASX Listing Rules, particularly in relation to related party transactions and conflicts of interest; and

(ii) the legal obligation of the Company’s Board to act for proper purposes and in the best interests of the Company’s Shareholders as a whole.

Proposed Director if members approve the Resolutions

Under the Funding Agreement, Express-Link may nominate a representative to the Company’s Board. At the date of this notice Express-Link has not nominated its representative.

Independent Expert

Assessment of Fairness

It is the opinion of the independent expert that at the conversion price offered by the Convertible Bonds, the capital raising under the Proposed Transaction is, prima facie, consistent with the previous capital raisings of the Company (the last being conducted at $0.07 cents per share).

However, concessions granted to ELM by Citigold under the terms of the Convertible Bonds make this comparison inappropriate. Incorporating these concessions (i.e. interest and options), they have calculated an effective capital raising price of $0.0473.

The implied discount of 14% they have calculated relative to the closing share price of Citigold of $0.055 immediately prior to the Proposed Transaction is inferior to the prices at which capital has been raised in the past by Citigold. Citigold has previously achieved premiums on its trading price in the order of 20% to 40% in its past three capital raisings. They note however that confidence in the gold sector has generally declined since the last raising with a decline in the gold price and the S&P/ASX All Ordinaries Gold Index of 16% and 38% respectively.

The discount the implied capital raising price represents relative to the closing price prior to the announcement to the Proposed Transaction is within the range of discounts for share issues completed by comparable Australian gold companies in the last 12 months of negative 60% to 16% (set out in Appendix B).

They have also considered items of value relevant to the Convertible Bonds (principally interest and the option value represented by the $0.07 conversion price). They have calculated a return on the Convertible Bonds of 26.4%. In their view, given the risk associated with the Convertible Bonds, this return is not unreasonable.

However, unlike other capital raisings completed by Citigold, there is potential for ELM to gain control of the Company. Comparing the controlling interest share value range they have calculated a price $0.072 to $0.077 to the effective capital raising price of $0.0473 implies a discount of 34% to 39%.

Having regard to the above assessments of the Proposed Transaction, it is their opinion that the Proposed Transaction does not incorporate a control premium into the price paid by ELM for its interest in Citigold upon conversion of the Convertible Bonds. On that basis and having regard to the above analysis they conclude that the Proposed Transaction is Not Fair to the Shareholders.

Assessment of reasonableness

It is the opinion of the independent expert that the history of capital raisings completed by Citigold suggests that the Company may have difficultly completing a capital raising of the magnitude contemplated under the Proposed Transaction on more favourable terms than those offered by the Convertible Bonds in the current environment.

After consideration of all of the issues set out in their report, it is their view that the Proposed Transaction is Reasonable to the Shareholders as at the date of the Report.

They are of the view that the advantages of the Proposed Transaction outweigh the disadvantages of the Proposed Transaction.

Key reasons why you should vote in favour of the Funding Agreement

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The Company considers that the Funding Agreement has a number of benefits for Shareholders, as summarised below and set out in more detail in section 2.1 (Key Reasons for the Funding Agreement) of this Explanatory Statement.

(a) The Convertible Bonds provide necessary funding for significant development of the Company’s Charters Towers Central and Imperial mines and hence the growth of the Company;
(b) Structuring the Funding Agreement to utilise Convertible Bonds may be less dilutionary for non-associated shareholders than issuing ordinary shares at a significant discount to market price in a typical placement, since the Convertible Bonds may not be converted into Shares and in any event, capital market conditions make such a placement difficult and costly to enter into;
(c) The Independent Expert has stated that discount the implied capital raising price represents relative to the closing price prior to the announcement to the Proposed Transaction is within the range of discounts for share issues completed by comparable Australian gold companies in the last 12 months of negative 60% to 16% (set out in Appendix B of the Independent Expert Report);
(d) The Funding Agreement serves as a basis to establish a relationship with Express-Link, securing Express-Link’s ongoing involvement and interest in the growth of the Company and its projects;
(e) The Company, with the assistance of its external corporate advisers and finance experts, has run an exhaustive process over a long period of time to identify and negotiate the best funding terms available and to date, the Board considers the Funding Agreement as the best finance terms made available to the Company;
(f) The debt element of the Converting Bonds, when compared to other debt facilities previously considered by Citigold, has been secured on relatively favourable terms, the coupon being 5% per annum and there being no security over the Company’s assets;
(g) The Funding Agreement does not prevent any future equity issuance by the Company; and
(h) The Independent Expert has concluded that the terms and conditions of the Funding Agreement are reasonable (see page 9 for more information on this).

Reasons why you may consider not voting in favour of the Funding Agreement

Shareholders should be aware that there are some potential disadvantages of the Funding Agreement, as summarised below and set out in more detail in section 2.2 of this Explanatory Statement.

(a) If Express-Link elects to Convert all of the Converting Bonds issued to it into Shares, Express-Link will substantially increase its voting power in the Company and existing Shareholders will be diluted. Express-Link’s voting power may be as high as 51%, assuming full conversion and no application of anti dilution provisions, in which case Express-Link will gain control of the Company without a takeover premium having been paid to Shareholders;
(b) Notwithstanding that, the Company, with the assistance of its external corporate advisers and finance experts, has run an exhaustive process over a long period of time to identify and negotiate the best funding terms available, you may consider that the Company may be able to obtain superior funding terms (although no superior proposal has emerged since announcement of the Express-Link Funding Agreement on 9 April 2013); and
(c) Having regard to:
(i) the effective capital raising price under the Funding Agreement (after taking into account interest payable by Citigold and the value of the conversions right) being 4.7 cents and hence a discount to Citigold’s share price immediately before announcement of the transaction; and
(ii) there being no control premium in the effective capital raising price, (where a control premium implies a price of 7.72-7.77 cents, as opposed to the effective capital raising price of only 4.7 cents),
(iii) the Independent Expert has concluded (on page 34 of the Report) that the Proposed Transaction is not fair.

Directors’ recommendation

The Directors unanimously support BDO’s opinion and recommend approval of the Funding Agreement, because:-

(a) the Funding Agreement provides the Company with capital to develop its Charters Towers gold project into production, as contemplated in section 1.3 below, in circumstances where the Company will have great difficulty in unlocking the value of its assets for shareholders without a capital injection of the size contemplated in the Funding Agreement;
(b) the funds raised will allow the Company to move significantly towards its stated goal of realizing the potential of its Charters Towers assets; and

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(c) The Independent Expert, taking into account the following factors (among others), has formed the view that the terms and conditions of the Funding Agreement are not fair but reasonable to shareholders of Citigold not associated with Express-Link:

(i) The conversion price of the Convertible Bonds is fixed at 7 cents (subject to adjustment if Citigold issues further equity);
(ii) Taking into account interest and conversion rights, the effective capital raising cost under the Funding Agreement is 4.7 cents and there is no premium for the right of Express-Link to convert and obtain control of Citigold;
(iii) The effective capital raising cost is at a discount of 14% to Citigold’s share price immediately prior to the announcement of the transaction and is larger than Citigold’s previous raisings, which attracted a premium of between 20% and 30%, but:
- A. Citigold’s previous equity capital raisings have been on progressively less favourable terms and were for materially smaller sums of capital;
- B. Citigold has historically had difficulty attracting debt funding;
- C. Sentiment in the gold sector and for commodities generally, has become weaker and since Citigold’s last completed capital raising, there has been a decline of 16% in the gold price and 38% in the S&P/All Ordinaries Gold Index;
- D. Given current conditions, there is no evidence Citigold will be able to attract equity capital on terms more favourable than the Funding Agreement;
- E. Citigold would have difficulty attracting debt funding without offering the lender upside potential similar to that offered under the Funding Agreement;
- F. Looking at the transaction from the perspective of the Lender, Express-Link gets a rate of return of 26.4% on its investment if it holds the bonds to maturity, which having regard to Citigold and its peers, is an appropriate rate of return for an investment of this nature; and
- G. The discount implied in the effective capital raising price of 4.7 cents, is in line with discounts offered by comparable gold companies to Citigold in Australia in the preceding 12 months, for equity capital raising;
(iv) In this context:
- A. A transaction is fair if the value of the consideration to be received by Shareholders (in this case, $100 million) is equal to or greater than the value of the Shares and other benefits (in this case, interest and conversion rights) that will be received by the Lender, Express-Link. The Independent Expert has concluded the Proposed Transaction is not fair; and
- B. An assessment of reasonableness evaluates other significant factors Shareholders may consider in deciding to vote for or against a transaction, such as the advantages and disadvantages of the transaction and the Shareholders’ position if the transaction is not approved. In other words, a transaction is reasonable if there are valid reasons for its approval, even despite (as in this case) the transaction not being assessed as fair .
- C. A transaction may be reasonable despite not being fair if, after considering other relevant factors, the interests of Shareholders are reasonably balanced.
(d) Weighing up all the factors, the Directors believe that despite the Funding Agreement not being fair , primarily owing to the absence of a control premium (see page 36 of the Report), the interests of Shareholders are reasonably balanced, having regard to the effective capital raising price, capital market conditions, the gold price, Citigold’s current position, equity raisings by comparable gold companies in Australia, the return being received by Express-Link and the preponderance of advantages over disadvantages (see paragraph 2.1).

The Directors therefore unanimously recommend Shareholders vote in favour of the Resolutions to approve the Funding Agreement and the issue of Convertible Bonds. Further information on the reasons for the Directors’ recommendation can be found at section 2.

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	Table of Contents
1.	Details of the Funding Agreement	13
1.1	Material Commercial Terms	13
1.2	Conditions precedent	13
1.3	Purpose of the Funding Agreement	15
1.4	Independent Expert's Report	15
1.5	Directors' Recommendations	15
2.	Rationale for the Funding Agreement	15
2.1	Key reasons for the Funding Agreement	16
2.2	Reasons why you may consider not voting in favour of the Funding Agreement	17
2.3	Independent Expert Considers Transaction is not fair but reasonable to Shareholders who are not
	associated with Express-Link	17
3.	About Express-Link	18
3.1	Express-Link's intentions	18
3.2	Proposed Director if members approve the Resolutions	19
4.	About the Company	19
4.1	History	19
4.2	Key Assets	20
4.3	Mineral Resources	20
4.4	Current Directors	20
4.5	Current capital structure	20
4.6	Top 20 Shareholders	21
4.7	Substantial Shareholders	21
5.	Impact on the Company's Financial Position	21
5.1	Use of funds made available under the Express-Link Facilities	21
5.2	_Pro forma_balance sheet	21
6.	Impact on the Company's Capital Structure	22
6.1	Current capital structure	22
6.2	Potential capital structure as a result of the Funding Agreement	22
6.3	Conversion mechanism for Convertible Bonds and effect of Conversion on the Company	23
6.4	Express-Link's potential shareholding in the Company	23
7.	Additional Information	24
7.1	Regulatory requirements	24
7.2	Section 611, item 7 approval	24
7.3	ASIC Regulatory Guide 74	25
7.4	Application of Listing Rule 7.1	26
7.5	Voting prohibition statement	26
7.6	Consents	26
8.	Glossary	27

Attachment A

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1. Details of the Funding Agreement

1.1 Material Commercial Terms

The material terms of the Funding Agreement are:

(a) Express-Link will subscribe for unsecured bonds ( Convertible Bonds ) in Citigold, up to an aggregate of $100 million and each having a face value of $1 million;
(b) Express-Link has subscribed for an initial tranche of 3 Convertible Bonds ( First Tranche ) at $3 million and:
(i) a further $7 million tranche within 4 months of the date of the Funding Agreement, subject to certain conditions precedent including Citigold shareholder approval, FIRB approval, there being no material adverse changes and other more technical legal issues (Citigold is advised that FIRB Approval has now been obtained by Express-Link); and
(ii) a further 6 tranches of 15 bonds at $15 million each, subject to conditions around there being material adverse changes and other technical issues, commencing quarterly 6 months after the date of the Funding Agreement.
(c) Interest is payable at 5% per annum on the outstanding balance of the Convertible Bonds and is payable:
(i) 6 months after the issue of Tranche 1 (ie 16 October 2013);
(ii) on the first anniversary of the issue of Tranche 1 (ie 16 April 2014); and
(iii) thereafter, on the anniversaries of those dates.
(d) The Convertible Bonds are not quoted;
(e) The Convertible Bonds have a maturity date of 3 years after the date of the Funding Agreement;
(f) Express-Link may elect to convert the Convertible Bonds into Shares in Citigold at any time during the term, at a conversion price of 7 cents per Share and in increments of $1 million;
(g) The conversion price is adjusted for changes to Citigold’s capital structure during the term. In any event, the conversion price may only be adjusted in such a way so that the holder of the convertible notes will not receive a benefit that holders of ordinary shares do not receive; and
(h) If shareholders and or the FIRB do not approve the transaction within 4 months of the date of the Funding Agreement, the Company may be required to repay the First Tranche within 30 days (Citigold is advised that FIRB Approval has now been obtained by Express-Link).

The timetable for the issue of the Convertible Bonds is summarised below:

Table 2:

Event/Tranche	Date
Execute Bond Subscription Agreement	8 April 2013
Tranche 1 - $3 million	16 April 2013
Shareholders meeting	8 July 2013
Tranche 2 - $7 million	Conditions Precedent date +5 Business days
Tranche 3 - $15 million	8 October 2013
Tranche 4 - $15 million	8 January 2014
Tranche 5 - $15 million	8 April 2014
Tranche 6 - $15 million	8 July 2014
Tranche 7 - $15 million	8 October 2014
Tranche 8 - $15 million	8 January 2015

1.2 Conditions precedent

The Funding Agreement is not, itself, subject to any conditions precedent and the Tranche 1 Convertible Bonds have already been issued.

However, the Tranche 2 Convertible Bonds and subsequent Tranches are subject to conditions precedent, namely:

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Tranche 2:

(a) FIRB approval for the issue of the Tranche 2 Convertible Bonds (Citigold is advised that the FIRB Approval obtained by Express-Link covers all subscription tranches, is valid until 15 May 2015 and permits Express Link Management to hold a maximum of 52% of the ordinary share capital of the Company);
(b) Approval for the issue of the Tranche 2 Convertible Bonds by Shareholders;
(c) The Company not having suffered a material adverse change;
(d) The Company’s Shares continuing to be quoted on ASX;
(e) There not being any materially adverse changes in applicable legislation; and
(f) The Company complying with certain technical provisions of the Corporations Act and complying with all its legal obligations, including its disclosure obligations;

Tranche 3 and subsequent tranches

(a) FIRB approval, to the extent not already obtained (Citigold is advised that the FIRB Approval obtained by Express-Link covers all subscription tranches, is valid until 15 May 2015 and permits Express Link Management to hold a maximum of 52% of the ordinary share capital of the Company);
(b) Approval for the issue of the Tranche 2 Convertible Bonds by Shareholders, unless the ASX Waiver has been obtained and approval granted pursuant to this Notice of Meeting;
(c) There being no legal prohibition on the issue of the Convertible Bonds;
(d) The Company not having suffered a material adverse change;
(e) There not being any materially adverse changes in applicable legislation;
(f) The Company’s Shares continuing to be quoted on ASX;
(g) The Company not having breached the Funding Agreement; and
(h) The Company complying with certain technical provisions of the Corporations Act and complying with all its legal obligations, including its disclosure obligations.

Other terms and conditions

The Funding Agreement includes the following further terms and conditions:

(a) The Company has agreed to a 3 month exclusivity period ending on 9 July 2013;
(b) Following completion of the Funding Agreement, Express-Link will have the right to appoint one member to the Board whilst it holds Convertible Bonds;
(c) The Convertible Bonds can only be transferred to affiliates of Express-Link; (d) Where Conversion leads to fractions of Shares, the cash equivalent at the Conversion Price in aggregate exceeding $10, will be paid to Express-Link;
(e) The Company will not be prevented from issuing further equity during the term of the Convertible Bonds on terms it sees fit. However, the conversion price of the Convertible Bonds will adjust to reflect any share capital reorganisation or share issue, including a placement or rights issue. Broadly speaking, the conversion price of the Convertible Bonds will adjust proportionately upwards with consolidation of the Company’s share capital and downwards where priced below the prevailing market price in the following circumstances:
(i) the Company declaring an extraordinary dividend;
(ii) any bonus issue of Shares to Shareholders;
(iii) consolidation or sub-division of Shares;
(iv) any issue of Shares, such as pursuant to a rights issue or placement; and
(v) any issue of Shares pursuant to a demerger or spin-off.

Events of Default

Express-Link will be entitled, during the Term, to redemption of the Convertible Bonds:

(a) should the Company become insolvent;
(b) should the Company be subject to a change of control;
(c) should the Company cease to have its Shares quoted on ASX;
(d) should the Company fail to make any payment under the Funding Agreement on the due date;

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(e) should the Company fail to issue Shares upon Conversion of any Convertible Bonds as required;
(f) should the Company breach the Funding Agreement and fail to remedy that breach;
(g) should any necessary approvals and consents (including any governmental, regulatory and/or corporate approvals and consents) for the issue redemption or conversion of the Convertible Bonds being revoked or withdrawn;
(h) should any distress, attachment, execution or other legal process be levied, enforced or sued out on or against any part of the property, assets or revenues of the Company, which adversely affects the ability of the Issuer to perform or observe any of its obligations under the Funding Agreement, and is not discharged or stayed within 30 days;
(i) should a mortgagee, security interest holder or other encumbrancer take possession of, exercise rights under any security in relation to, or a receiver, receiver and manager, administrator, liquidator, provisional liquidator or officer of the Court appointed in relation to, the whole or any substantial part of the property, assets or revenues of the Company and not be discharged within 30 days;
(j) should it become unlawful for the Company to perform or comply with any one or more of its obligations under the Funding Agreement.

However, the Company may undertake a reconstruction, amalgamation, reorganisation, merger or consolidation not involving insolvency or which does not adversely affect the ability of the Company to perform or observe its obligations under the Funding Agreement.

1.3 Purpose of the Funding Agreement

The funding from the Funding Agreement will be used for the development into production of the Company’s Charters Towers Central and Imperial mines and for working capital. In particular, the following application of funds has been agreed:

(a) Quarter 1 - $7 million - Re-commissioning of Central Mine (improvement of infrastructure and modernisation of decline), finalisation of mine plan and drilling program, development of Imperial decline, completion of tender process for contractors and acquisition of land surrounding mining infrastructure.
(b) Quarter 2 - $15 million drawdown - Re-commissioning of Central mine (improvement of infrastructure and modernisation of decline), commencement of drill program at 5,000 metres per month, advancement of Imperial decline at 200 metres per month, awarding Central decline contract, finalising acquisition of expansion lands and process plant modernisation.
(c) Quarter 3 - $15 million drawdown - Expand dewatering facilities at Central Mine, advance Central decline at 200 metres per month, increase drill program to 6,500 metres per month, commence ore level development at Imperial Mine, continue plant modernisation.
(d) Quarter 4 - $15 million drawdown - Continue to advance Central decline (200 metres per month), continue drill program at 6,500 metres per month, continue in ore development at Imperial Mine, commence stoping at Imperial mine.
(e) Quarter 5 - $15 million drawdown - Continue to advance Central decline, advance the Imperial decline, continue ore development and stoping at Imperial Mine, trial on site ore pre-processing, continue drill program at 6,500 metres per month
(f) Quarter 6 - $15 million drawdown – Commence ore level development at Central mine, continue Decline development at Central mine, continue ore development and stoping at Imperial Mine, increase drill program to 8,000 metres per month
(g) Quarter 7 - $15 million drawdown - Continue ore level development at Central mine, continue Decline development at Central mine, continue in ore development and stoping at Imperial Mine, increase drill program to 8,000 metres per month at central decline.

1.4 Independent Expert's Report

The Independent Expert has found that the Funding Agreement is not fair but reasonable to Shareholders who are not associated with Express-Link. Further detail of the values, the methodology and assumptions used by the Independent Expert are contained in the Independent Expert's Report.

1.5 Directors' Recommendations

The Directors recommend Shareholders vote in favour of the Resolutions to approve the Funding Agreement. Further information on the reasons for each Director's recommendation can be found at section 2.1 and on pages 10 and 11 of this Notice.

2. Rationale for the Funding Agreement

The Funding Agreement provides the Company with funding to develop its Charters Towers gold project into production, as contemplated in section 1.3 above.

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Express-Link represents a logical and mutually beneficial funding partner for Citigold’s projects because, in the current difficult capital market, Express-Link has demonstrated a long term vision and confidence in Citigold’s assets and has significant and diverse investment acumen.

The Directors believe that the terms of the Funding Agreement are arguably no less dilutionary than an equity raising if the Convertible Bonds are converted.

The Directors believe that this funding will allow the Company to move significantly towards its stated goal of realizing the potential of its Charters Towers assets.

2.1 Key reasons for the Funding Agreement

(a) The Convertible Bonds provide necessary funding for development of the Charters Towers gold project and growth of the Company

The Funding Agreement will provide the Company with funding to significantly progress development of its Charters Towers gold project assets. The Funding Agreement has been structured to ensure, as far as practicable, financial certainty for the Company and to manage its cash flow during development.

The Funding Agreement will help the Company progress its transformation from project developer to producing miner.

If the Funding Agreement is not approved, the Company may not be able to proceed as effectively with its planned development as it would if the Funding Agreement is approved. If the Company continues to seek alternative funding arrangement, this is likely to significantly delay the date for development of its projects to their full potential and in the future, conditions for attracting investment may deteriorate.

(b) Utilising Convertible Bonds is not likely to be any more dilutionary for Shareholders than the corresponding amount of equity funding in a typical placement and to the extent not converted, the Convertible Bonds are less dilutionary

If the subscription money for the Convertible Bonds is repaid and the Convertible Bonds are not converted into Shares by Express-Link, there will be no dilution to Shareholders.

If the Convertible Bonds are Converted into Shares, the effect will be that the voting power of Express-Link will increase to a maximum of approximately 51% on a fully diluted basis (1,428,571,429 shares). However, Conversion has been agreed at a price per Share (adjustable only in limited circumstances proportionate to changes to the Company’s capital structure).

In the absence of the Funding Agreement, the Company would still need to pursue other funding alternatives. If those alternatives include equity funding, such as a placement or other equity investment, the result is not likely to be materially less dilutionary toexisting Shareholders than the impact of conversion of the Convertible Bonds. The Independent Expert has noted that the effective capital raising cost is at a discount of 14% to Citigold’s share price immediately prior to the announcement of the transaction and is larger than Citigold’s previous raisings, which attracted a premium of between 20% and 30%, has noted that:

(i) Given current conditions, there is no evidence Citigold will be able to attract equity capital on terms more favourable than the Funding Agreement; and
(ii) the discount implied in the effective capital raising price of 4.7 cents, is in line with discounts offered by gold companies comparable to Citigold in Australia in the preceding 12 months, for equity capital raising. It should be noted however that the issue under the Proposed Transaction represents a potential controlling interest in the Company, relative to other minority raisings.
(c) The issue of the Convertible Bonds may not result in dilution of Shareholders

Once the Convertible Bonds have been issued, Express-Link may elect to either:

(i) Allow the Company the amounts advanced pursuant to subscription for the Convertible Bonds on the Maturity Date; or
(ii) Convert those Convertible Bonds into Shares at any time prior to the Maturity Date.

If Express-Link elects to convert the Convertible Bonds into Shares it must convert at least 1 Bond. If Express-Link does not make such an election, no Conversion Shares will be issued to Express-Link. For further information on the dilutionary impact of a conversion of the Convertible Bonds, see section 6

The portion of the Convertible Bonds that is converted into Shares proportionally reduces the Company’s debt to Express-Link and does not require repayment.

(d) The Funding Agreement establishes a strategic relationship with Express-Link

The Funding Agreement strengthens the Company's strategic relationship with Express-Link, whose Director, Mr Ooi, has a demonstrated track record of strategic investment into diverse asset classes.

As part of the Funding Agreement, the Company has also agreed to provide Express-Link with 1 seat on the Board for as long as Express-Link still holds Convertible Bonds.

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The Directors believe that having Express-Link as a funding partner will provide significant benefits for Shareholders because with Express-Link’s major investment into the Company, they will have a vested interest in the Company’s success.

(e) Express-Link's Board representative has the potential to bring additional skills

Express-Link will have the right to appoint one member to the Board for so long as it holds Convertible Bonds. The Company believes that this has the potential to add value to the Board by bringing additional experience in the financing and development of land based assets.

(f) Further equity issues permitted

The Funding Agreement provides the Company with significant flexibility to manage its cash flow and future capital raising ability. In this respect, the Funding Agreement with Express-Link would not prevent the Company from issuing new equity in the future, as Express-Link’s interest in the Company’s Shares will be proportionately adjusted to maintain its interest at pre-issue levels.

2.2 Reasons why you may consider not voting in favour of the Funding Agreement

(a) If Express-Link elects to Convert all of the Convertible Bonds into Shares, Express-Link will substantially increase its voting power in the Company and existing Shareholders will be diluted – the maximum extent of Express-Link’s relevant interest in the Company’s Shares, if all the Convertible Bonds are issued and Converted, is approximately 51%, in which case Express-Link will gain control of the Company without providing Shareholders with a takeover premium.

The level of Express-Link's increased shareholding and maximum voting power will ultimately depend on:

(i) the number of Convertible Bonds Express-Link ultimately subscribes for (which depends on the stated conditions precedent being satisfied and no events of default occurring) and therefore, the value of the Convertible Bonds issued to Express-Link;
(ii) the extent to which Express-Link elects to convert the Convertible Bonds into Shares and not have the Company repay the Convertible Bonds in cash; and
(iii) the number of other Shares held by Express-Link at the time the Convertible Bonds are converted into Shares.

Details of the potential capital structure of the Company and Express-Link's potential holding of Shares, as a result of the issue of the Convertible Bonds and their potential Conversion, is set out in sections 6.2 and 6.4.

For example, at the Conversion Price of 7 cents, on Conversion of all 100 of the Convertible Bonds, Express-Link may hold a relevant interest in more than 50% of Shares. Express-Link would effectively be able to control the Company, but in those circumstances, it would not have paid a premium to obtain that control.

In addition, while Express-Link holds Convertible Bonds, Express-Link will have the right to request that the Company appoint to the Board one person nominated by Express-Link, and will therefore participate in the Company’s Board discussions and decisions, subject always to the Corporations Act and the ASX Listing Rules.

Notwithstanding that the Company, with the assistance of its external corporate advisers and finance experts, has run an exhaustive process over a long period of time to identify and negotiate the best funding terms available, you may consider that the Company may be able to obtain superior funding terms (although no superior proposal has emerged since announcement of the Express-Link Funding Agreement on 9 April 2013).

A rigorous process was pursued to find the best available terms. Following a lengthy process the most definitive, commercially attractive terms that the Company was able to negotiate, were with Express-Link. In accepting the terms and conditions of the Funding Agreement, the Directors took into account the substantial length of time the Company has been seeking a funding partner and the pressing need for the Company to secure financing in a timely manner to enable development of its projects, as desired.

Notwithstanding this, you may consider that a superior proposal may still arise that will be more attractive than the Funding Agreement and this may be a reason you may consider voting against the Funding Agreement. If you are considering this, the Directors would also like to highlight that other potential funders have had the opportunity to provide alternative proposals and, as at the date of this document, no other proposals have been presented to the Board since the Company announced the Funding Agreement on 9 April 2013.

2.3 Independent Expert Considers Transaction is not fair but reasonable to Shareholders who are not associated with Express-Link

The Independent Expert has considered the Express-Link Funding Agreement and has found that the Funding Agreement is not fair but reasonable to Shareholders not associated with Express-Link.

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In light of the findings of the Independent Expert, and after considering the potential advantages and disadvantages of the Funding Agreement, the Directors recommend Shareholders vote in favour of the Resolutions to approve the Express-Link Funding Agreement.

3. About Express-Link

Express-Link Management Ltd ( Express-Link ) is a company controlled by its sole Director, Mr Ooi Cheu Kok who resides in Malaysia and is a Malaysian citizen. Mr Ooi Cheu Kok manages Express-Link Management Ltd from Malaysia. Mr Ooi Cheu Kok is a veteran of the investing community in his home country, Malaysia, as well as in South East Asia. In 1988, Mr Ooi graduated from La Trobe University (Melbourne, Australia) with a Bachelor of Economics (Accounting). Upon his return to Asia, Mr Ooi started off as a real-estate developer. Mr Ooi founded Golden Wave Sdn Bhd, a billion-dollar commercial development project in Kota Kinabalu, East Malaysia. Mr Ooi was instrumental in developing that project with the local government authorities.

His other interests include projects in Sabah; residential developments in KolKol and Tenom, and a sea front resort in Marudu, and the Centrepoint Shopping Centre in Kota Kinabalu.

Since 2010, Mr Ooi has ventured from real property development to investing in public and private equities in Asia. Most significant and recent are his holdings in SGX (Singapore mainboard listed) company Blumont Group (market cap SGD$1.36 billion as at 2 May 2013). Mr Ooi holds a substantial stake in the Blumont Group and is its second largest shareholder.

Express-Link is a company incorporated in accordance with the laws of the British Virgin Islands (Company Number 17598547) and is wholly owned by Mr Ooi Cheu Kok. Express-Link has no subsidiaries or affiliated companies. The sole director of Express-Link is Mr Ooi Cheu Kok. Express-Link does not have any other Australian operations as at the date of this Notice.

Express-Link’s major activities are investment, and, accordingly, Express-Link has decided to invest in the Company as part of its investment strategy.

3.1 Express-Link's intentions

(a) Review

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statements of current intention only which may change as new information becomes available or circumstances change. The statements referred to in this section 3 should be read in this context.

(b) Intentions

(i) to continue the business of the Company as it is currently conducted (subject to implementing the development programme set out in section 1.3);
(ii) not to make any major changes to the business of the Company or the deployment of the Company's assets;
(iii) not to transfer any Company property between the Company and Express-Link or any person associated with Express-Link;
(iv) not intend to acquire any additional shares in the Company on-market during the term of the Bonds;
(v) to continue the employment of the Company's existing Employees;
(vi) not to interfere with the Company maintaining a strong Board that operates independently of, and separately to, Express-Link; and
(vii) not to significantly change the financial or dividend distribution policies of the Company.

Before Express-Link can Convert the Convertible Bonds, a number of conditions must be satisfied, including Shareholder approval under this Notice of Meeting, appropriate disclosure to ensure there are no restrictions on Express-Link’s ability to sell i ts Convertible Bonds, Express-Link having obtained FIRB approval (Citigold is advised that the FIRB Approval obtained by Express-Link covers all subscription tranches, is valid until 15 May 2015 and permits Express Link Management to hold a maximum of 52% of the ordinary share capital of the Company) and any other regulatory approvals that apply (if any) and there being no material adverse change in relation to the Company, including the Company remaining listed on ASX.

(i) the law and the ASX Listing Rules, particularly in relation to related party transactions and conflicts of interest; and
(ii) the legal obligation of the Company’s Board to act for proper purposes and in the best interests of the Company’s Shareholders as a whole.

3.2 Proposed Director if members approve the Resolutions

Under the Funding Agreement, Express-Link may nominate a representative to the Company’s Board. At the date of this notice Express-Link has not nominated its representative.

4. About the Company

4.1 History

Citigold is an Australian Public Company listed on the Australian Securities Exchange (ASX), trading code ‘CTO’, in 1993.

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After achieving 100% control of the goldfield in 2004, based on over 146 kilometres of drilling plus extensive past mining data, Citigold in 2005 announced a JORC compliant Inferred Mineral Resource of 10 million ounces of gold in 23 million tonnes of mineralisation having an estimated gold content of 14 grams per tonne.

Citigold, in 2012, updated the Inferred Mineral Resource to 11 million ounces of gold in 25 million tonnes of mineralisation having an estimated gold content of 14 grams per tonne. The Probable Ore Reserve increased to 620,000 ounces of gold in 2,500,000 tonnes at 7.7 grams per tonne gold. This upgrade was based on a data base of over 300 kilometres of drilling plus the extensive mining data.

4.2 Key Assets

Citigold Corporation Limited is developing the 11 million ounce Charters Towers gold deposit and has commenced commercially extracting gold with the objective to build up gold production from its underground mines in stages to over 300,000 ounces per annum.

The Charters Towers area produced over 200 tonnes (6.6 million ounces) of gold from 1871-1917. The gold is concentrated in sheeted veins (reefs) and is Australia’s highest grade major goldfield with the historical average grade of 38 grams per tonne (over 1 ounce per tonne). The regional area, in recent years, has produced an additional 8 million ounces.

The Company has already invested almost $200 million building the required infrastructure to grow production, including a 340,000 tonne per annum process plant, over 4 kilometres of underground access declines, workshops, offices, site based access to the state electricity grid, mobile mining fleet and water storage and access facilities. This infrastructure is all accessed by paved roads maintained by the state authority.

4.3 Mineral Resources

Table 3

Category	Tonnes	Grade	Cut off	Contained
		g/t Au		Ounces
Inferred Mineral Resource	25,000,000	14.0	3.0 g/t	11,000,000
Indicated Mineral Resources(includes	3,200,000	7.6	4.0 g/t	780,000
Probable Ore Reserves)
Probable Ore Reserves(derived from and	2,500,000	7.7	4.0 g/t	620,000
contained within Indicated Mineral Resource)

4.4 Current Directors

As at the date of this Explanatory Statement, the Company's Directors are:

Table 4:

Director	Position	Interest in the Company Shares
Mr John Foley	Chairman	4,736,450
Mr Mark Lynch	ManagingDirector	81,347,083
Dr Brian White	Executive Director	28,350
Mr Matthew Gill	Non Exec. Director	-
Mr Kim Koh	Non Exec. Director	49,000,000
Mr Satish Panchariya	Non Exec. Director	-
Mr Raymond Tan	Non Exec. Director	-

4.5 Current capital structure

The following sets out the capital structure of the Company as at the date of this Explanatory Statement.

Table 5

Securities on Issue	Number
Shares	1,352,907,765
Convertible Bonds	3

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Options (Options expiring 28 June 2015)

7,997,917

4.6 Top 20 Shareholders

The top 20 Shareholders of the Company as at 3 June 2013, being the last practical date before the date of this Explanatory Statement are shown in the table below:

Table 6:


Shareholders	Shares	Relevant interest
		%

Liongold CorpLtd	239,285,714	17.69
K Sera Sera Holdings PtyLtd	96,951,372	7.16
CiticorpNominees PtyLimited	72,729,805	5.38
Aurora Investments Limited	68,659,983	5.07
UOB KayHian Private Ltd	45,638,105	3.37
PhillipSecurities Pte Ltd	39,363,471	2.91
JP Morgan Nominees Australia Limited	38,661,707	2.86
Dmg& Partners Securities Pte Ltd	29,082,913	2.15
JFO Investments PtyLtd	21,542,292	1.59
HSBC CustodyNominees Limited	20,123,438	1.49
Mr Kim Teck Koh	20,000,000	1.48
JF Apex Securities Berhad	11,645,132	0.86
Mr Weitian Zhang	9,899,129	0.73
Underwriting& MiningInvestment CorpP/L	9,832,732	0.73
Nefco Nominees PtyLtd	8,354,757	0.62
Bill Ford Nominees PtyLtd	6,153,981	0.45
John Francis Lynch	5,669,090	0.42
Miss LilyLee	5,500,000	0.41
Mr Kenos + Mrs Kenos	5,000,000	0.37
Pal GroupLimited	4,411,111	0.33
	758,504,732	56.07
Top 20 total

4.7 Substantial Shareholders

Based on the substantial holder reporting information provided to the Company, the Substantial Shareholders of the company are:

Table 7:

Shareholder	Number of shares	Relevant interest (%)
Liongold CorpLtd	239,285,714	17.69
K Sera Sera Holdings PtyLtd	96,951,372	7.16
Aurora Investments Limited	68,659,983	5.07

5. Impact on the Company's Financial Position

5.1 Use of funds made available under the Express-Link Facilities

The funding from the Funding Agreement will be used for the development of the Company’s Charters Towers project, as set out in section 1.3.

5.2 Pro forma balance sheet

The audited consolidated balance sheet of Citigold at 30 June 2012, the unaudited balance sheet at 31 March 2013 and the unaudited pro forma balance of Citigold at 31 March 2013 are set out below. The pro forma balance sheet is based on the unaudited accounts of Citigold as at 31 March 2013 adjusted for the Funding Agreement as set out below.

The pro forma balance sheet at 31 March 2013 assumes the following occurred as at that date:

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(i)

issue of the convertible notes ($100M) to Express-Link in accordance with the Convertible Note Deed. The pro forma balance sheet assumes net cash received as there are no commissions payable on the Proposed Transaction and transaction costs (professional fees) are immaterial. The $99.85M is allocated between debt ($76.22M), equity ($23.63M). No tax effect accounting is taken into consideration as any deferred tax liability is offset against carried forward tax losses (previously unrecognised).

Current assets Cash and cash equivalents Receivables Inventories Non-current assets Investments in associates Property, plant and equipment Other Liabilities Payables and accrued liabilities Borrowings Provisions Convertible Notes - unsecured Net assets Equity Issued capital Other equity – value of conversion rights Reserves Accumulated Losses Minority interest	$’000	$’000
	Actual Pro Forma
	Jun-12 3,182 7,230 203	Mar-13 Mar-13 454 100,304 633 633 607 607
	10,615	1,694 101,544
	2,960 195,793 553	- - 204,993 204,993 553 553
	199,306	205,546 205,546
	209,921	207,240 307,090
	7,803 3,405 2,489 -	5,047 5,047 1,075 1,075 1,425 1,425 - 76,220
	13,697	7,547 83,767
	196,224	199,693 223,323
	189,868 - 39,311 (33,024) 69	197,868 197,868 - 23,630 39,257 39,257 -37,501 -37,501 69 69
	196,224	199,693 223,323

6. Impact on the Company's Capital Structure

6.1 Current capital structure

See section 4.5 for details of the Company's current capital structure.

6.2 Potential capital structure as a result of the Funding Agreement

As at the date of this Explanatory Statement, Express-Link does not have a relevant interest in the Company.

If the Funding Agreement is approved and Resolutions 1 and 2 are passed by Shareholders, and all other conditions to the Funding Agreement are satisfied, the Convertible Bonds will be issued to Express-Link.

Assuming that the Company issues the Convertible Bonds for the full $100 million, and no Convertible Bonds have been Converted into Shares, the capital structure of the Company will be as follows:

Table 8:

Securities on Issue	Number
Shares	1,352,907,765

Citigold Corporation Limited – Notice of General Meeting

Page 22

Convertible Bonds	100
Options (Options expiring 28 June 2015)	7,997,917

Under the terms of the Funding Agreement, in certain circumstances, Express Link may elect to Convert the Convertible Bonds into Shares in the Company and not have the Company repay the outstanding aggregate face value in cash. The capital structure of the Company if the Convertible Bonds are converted into Shares and not repaid in cash, is set out below in section 6.4.

6.3 Conversion mechanism for Convertible Bonds and effect of Conversion on the Company

The number of Shares to be issued upon conversion of a Convertible Bond is determined as follows:

Principal Amount

Conversion Price in effect on the conversion date

Where:

Principal Amount means, in respect of each Convertible Bond at any time, the outstanding principal amount of that Convertible Bond.

Conversion Price means 7 cents.

The Conversion Price in effect on the Conversion date will be the Conversion Price, subject to any subsequent adjustment in accordance with the Convertible Bond Agreement.

6.4 Express-Link's potential shareholding in the Company

The level of Express-Link's maximum potential shareholding will ultimately depend on:

(a) the extent to which Express-Link subscribes for Convertible Bonds under the Funding Agreement and therefore the aggregate value of the Convertible Bonds issued to Express-Link;
(b) the extent to which the Convertible Bonds are converted into Shares and not repaid in cash;
(c) the Conversion Price for the Convertible Bonds (as adjusted in accordance with the terms of the Funding Agreement);
(d) the number of Shares on issue at the time the Convertible Bonds are converted into Shares; and
(e) the number of Shares held by Express-Link at the time that the Convertible Bonds are converted into Shares.

The table below assumes the following:

(a) The Company issues Convertible Bonds to Express-Link for the full $100 million;
(b) All Convertible Bonds are converted into Shares in accordance with their terms;
(c) Express-Link does not acquire any Shares (other than the Subscription Shares) until Conversion of the Convertible Bonds and the Company does not issue any additional Shares prior to the Conversion of the Convertible Bonds; and
(d) No adjustment event occurs that would result in an amendment to the Conversion Price of the Convertible Bonds (for example, if the Company makes a bonus issue of Shares, or if there were a consolidation or subdivision of Shares).

Prior to Conversion of the Convertible Bonds, Express-Link would not be restricted from acquiring Shares on-market, subject to the limits imposed by Australia's takeover laws. If Express-Link acquires additional Shares, this will increase Express-Link's total percentage shareholding following any Conversion of the Convertible Bonds. Express-Link has confirmed that it currently has no intention of acquiring additional Shares in the Company on-market during the term of the Bonds. Further, such an acquisition would need FIRB approval.

Table 9

Capital	Scenario 1	Scenario 2	Scenario 3
structure	*Conversion of none of*	*Conversion of half of the*	*Conversion of all of*
	*the Convertible Bonds*	*Convertible Bonds*	*the Convertible Bonds*



Shares	1,352,907,765	2,067,193,480	2,781,479,194

Citigold Corporation Limited – Notice of General Meeting

Page 23

7. Additional Information

7.1 Regulatory requirements

Section 606(1) of the Corporations Act provides that a person must not (without an available exemption under the Corporations Act) acquire a relevant interest in issued voting shares of a listed company if the person acquiring the interest does so through a transaction in relation to the securities entered into by or on behalf of the person and, because of the transaction, that person’s or someone else’s voting power in the listed company increases:

(a) from 20% or below to more than 20%; or
(b) from a starting point that is above 20% and below 90%.

Under section 608(1) of the Corporations Act, a person has a relevant interest in securities if they are the holder of the securities, have power to exercise, or control the exercise of, a right to vote attached to the securities or have power to dispose of, or control the exercise of a power to dispose of, the securities. It does not matter how remote the relevant interest is, or how it arises. If two or more people can jointly exercise one of these powers, each of them is taken to have that power.

7.2 Section 611, item 7 approval

An exemption for the issue of the Convertible Bonds (and the issue of any Shares upon conversion of the Convertible Bonds) is available under item 7 of section 611 of the Corporations Act.

This section broadly provides that an acquisition approved previously by a resolution passed at a general meeting of the company in which the acquisition is made is exempt from the prohibition in section 606(1), if:

(a) no votes are cast in favour of the resolution by:
(i) the person proposing to make the acquisition and their associates; or
(ii) the persons (if any) from whom the acquisition is to be made and their associates; and
(b) the members of the Company were given all information known to the person proposing to make the acquisition or their associates, or known to the Company, that was material to the decision on how to vote on the resolution, including:
(i) the identity of the person proposing to make the acquisition and their associates;
(ii) the maximum extent of the increase in that person's voting power in the company that would result from the acquisition;
(iii) the voting power that person would have as a result of the acquisition;
(iv) the maximum extent of the increase in the voting power of each of that person's associates that would result from the acquisition; and
(v) the voting power that each of that person's associates would have as a result of the acquisition.

The Notice of Meeting includes a voting prohibition statement restricting Express-Link and each of its associates from voting on the resolutions. The information required under item 7 of section 611 of the Corporations Act is also set out below.

The voting power of a person in a body corporate is determined in accordance with section 610 of the Corporations Act. The calculation of a person’s voting power in a company involves determining the voting shares in the company in which the person, and the person’s associates, have a relevant interest.

An “associate” of a company includes (among others):

(a) a body corporate that controls the company or a body corporate controlled by the company;
(b) a person with whom the company has, or proposes to enter into, a relevant agreement for the purposes of controlling or influencing the composition of the company’s board or the conduct of the company’s affairs; and
(c) a person who is acting or proposing to act in concert in relation to the company’s affairs.

Resolution 1 seeks Shareholder approval for the purposes of item 7 of section 611 of the Corporations Act for the issue 100 Convertible Bonds.

The following information is provided to Shareholders:

(a) The identity of the person proposing to make the acquisition and their associates

The Convertible Bonds, and any Shares issued upon conversion of the Convertible Bonds, being issued pursuant to Resolution 1, are being issued to Express-Link or its related body corporate.

Citigold Corporation Limited – Notice of General Meeting

Page 24

See section 3 for further information about Express-Link.

(b) The maximum extent of the increase in that person’s voting power in the company and the voting power that would result from the acquisition.

Express-Link currently has zero voting power in the Company. The increase in Express-Link's voting power from this initial point will ultimately depend on:

(i) the number of Convertible Bonds ultimately subscribed for by Express-Link;
(ii) the extent to which the Convertible Bonds are converted into Shares and not repaid in cash;
(iii) the Conversion Price for the Convertible Bonds (as adjusted in accordance with the terms of the Funding Agreement);
(iv) the number of Shares on issue at the time the Convertible Bonds are converted into Shares; and
(v) the number of Shares held by Express-Link at the time the Convertible Bonds are Converted into Shares.

For illustrative purposes, various scenarios have been included in section 6.4.

(c) The maximum extent of the increase in the voting power of each of that person’s associates and the voting power that would result from the acquisition.

The maximum extent of each of Express-Link’s associates' increase in voting power, and its voting power, will be equivalent to the increase in voting power held by Express-Link. For further details of the potential voting power of Express-Link, see section 6.4.

7.3 ASIC Regulatory Guide 74

ASIC Regulatory Guide 74 requires that the following information be provided to Shareholders to enable Shareholders to make an informed decision on the Resolutions:

(a) The identity of the allottee or purchaser and any person who will have a relevant interest in the shares to be allotted or purchased.
(b) The Convertible Bonds, and any Shares issued upon conversion of the Convertible Bonds, are currently intended to be issued to Express-Link Management Limited.
(c) See section 3 for further information about Express-Link.
(d) Full particulars (including the number and the percentage) of the Shares in the company to which the allottee or purchaser is or will be entitled immediately before and after the proposed acquisition.
(e) Full details of the of the potential shares in the Company to which the allottee or purchaser is or will be entitled immediately before and after the proposed acquisition are set out in section 6.4.
(f) The identity, associations (with the allottee, purchaser or vendor and with any of their associates) and qualifications of any person who it is intended will become a Director if the Shareholders agree to the allotment or purchase.
(g) See section 3.1 above.
(h) A statement of the allottee’s or purchaser’s intentions regarding the future of the company if Shareholders agree to the allotment or purchase, and in particular, any intention to change the business of the company; any intention to inject further capital into the company and if so, how; the future employment of the present employees of the company; any proposal whereby any property will be transferred between the company and the allottee, vendor or purchaser or any person associated with any of them; and any intention to otherwise redeploy the fixed assets of the company.

See section 3.1 above.

(i) Particulars of the terms of the proposed allotment or purchase and any other contract or proposed contract between the allottee and the company or vendor or any of their associates which is conditional upon, or directly or indirectly dependent on, Shareholders’ agreement to the allotment or purchase

All the Convertible Bonds except those under Tranche 1 are subject to Shareholder approval under item 7 of Section 611 of the Corporations Act.

(j) When the allotment is to be made or the purchase is to be completed.

The Convertible Bonds will be subscribed for, and issued to, Express-Link in accordance with the timetable set out in Table 1 above.

Citigold Corporation Limited – Notice of General Meeting

Page 25

Express-Link may Convert any Convertible Bonds it holds in increments of $1 million at any time before the Maturity Date and Conversion Shares must be issued within 1 business day after receipt by the Company of the relevant notice from Express-Link.

(k) An explanation of the reasons for any proposed allotment.

An explanation of the rationale for the Funding Agreement, including the issue of the Convertible Bonds, is set out in section 2.

(l) The interests of the Directors in the Resolutions The Directors do not have a material personal interest in the outcome of the resolutions other than in their capacity as Shareholders. The Directors' interests in Shares and Options are set out in section 4.4 above.
(m) The recommendation or otherwise of each Director as to whether the non- associated Shareholders should agree to the acquisition, and the reasons for that recommendation or otherwise.

The Directors unanimously recommend Shareholders vote in favour of the Resolutions to approve the Funding Agreement. This recommendation is based on the information set out in this document and as a result of the Independent Expert finding that the Funding Agreement is not fair but reasonable to Shareholders who are not associated with Express-Link. The Directors concluded that the Funding Agreement represents the best funding proposal for the Company for the reasons set out in this Notice of Meeting, including those set out in more detail in section 2.1 and on pages 10 and 11.

The Directors further note that the Independent Expert has found the Funding Agreement to be not fair but reasonable to Shareholders who are not associated with Express-Link (for more information, see pages 12 and 13).

(n) Any intention of the acquirer to change significantly the financial or dividend policies of the company.

Express-Link has not indicated any such intention to the Company.

(o) An analysis of whether the proposal is fair and reasonable when considered in the context of the interests of the Shareholders other than those involved in the proposed allotment or purchase or associated with such persons.

In accordance with ASIC Regulatory Guide 74, the Company commissioned BDO to prepare an Independent Expert’s Report to assess whether the Express-Link Facilities are fair and reasonable to Shareholders not associated with Express-Link.

The Independent Expert’s Report concluded that the Funding Agreement is not fair but reasonable to Shareholders who are not associated with Express-Link.

A copy of the Independent Expert’s Report is contained in Attachment A.

Neither the Company nor the Directors are aware of any additional information not set out in this Explanatory Statement that would be relevant to Shareholders in deciding how to vote on the Resolutions.

7.4 Application of Listing Rule 7.1

Listing Rule 7.1 imposes a limit on the number of equity securities (eg shares or options to subscribe for shares) that a company can issue without shareholder approval. In general terms, a company may not, without prior shareholder approval, issue equity securities if the equity securities will in themselves or when aggregated with the securities issued by the company during the previous 12 months, exceed 15% of the number of fully paid ordinary shares on issue at the commencement of that 12 month period.

Listing Rule 7.2, exception 16 states that Listing Rule 7.1 does not apply to an issue of securities approved by shareholders for the purposes of item 7 of section 611 of the Corporations Act. Accordingly, the resolutions do not seek approval for the issue of Convertible Bonds, or the issue of Shares upon conversion of the Convertible Bonds, to Express-Link for the purposes of Listing Rule 7.1.

7.5 Voting prohibition statement

In accordance with item 7 of section 611 of the Corporations Act, none of Express-Link and its associates are permitted to vote in favour of the Resolutions.

7.6 Consents

Each of the following persons has consented in writing to being named in this Explanatory Statement in the form and context in which they are named, and has not withdrawn that consent as at the date of this Explanatory Statement:

(a) Express-Link; and
(b) BDO.

Citigold Corporation Limited – Notice of General Meeting

Page 26

The Independent Expert also consents to the inclusion of the Independent Expert's Report and references to the Independent Expert's Report in this Explanatory Statement, in the form and context in which they are included.

8. Glossary

AEST means Australian Eastern Standard Time. ASIC means the Australian Securities and Investments Commission. ASX means ASX Limited (ACN 008 624 691). ASX Listing Rules or Listing means the official listing rules of ASX. Rules Board means the Company Board of Directors. Conversion means the conversion of the Convertible Bonds into Shares in accordance with the terms of the issue of the Convertible Bonds and Funding Agreement, essentially involving the issue of Shares at an issue price of 7 cents in repayment of the outstanding balance of the Convertible Bonds. Convertible Bond means the unsecured bonds in the Company to be issued to ExpressLink Management Limited pursuant to the Funding Agreement. Corporations Act means the Corporations Act 2001 (Cth). Director means a current director of the Company. FIRB Approval means the Treasurer of the Commonwealth of Australia approving or failing to object to the Funding Agreement and transactions contemplated in it under the Foreign Acquisition and Takeovers Act 1975 (Cth). Funding Agreement means the agreement between the Company and Express-Link Management Limited dated 9 April 2013 pursuant to which ExpressLink has agreed to subscribe, subject to certain limited conditions, for $100 million in Convertible Notes. Fully Diluted means having regard to the maximum number of Shares that would be on issue of all securities in the Company convertible into Shares were Converted. Independent Expert means BDO Corporate Finance (QLD) Ltd. Notice of Meeting means the notice of general meeting accompanying this Explanatory Statement Report means the Independent Expert’s Report of BDO dated 30 May 2013. Resolution means a resolution 1 put to Shareholders in this Notice of Meeting. Share means a fully-paid Ordinary Share in the Company. Shareholder means a holder of a Share. Tranche 1 means the 3 Convertible Bonds issued on 16 April 2013 pursuant to the Funding Agreement and having an aggregate face value of $3 million.

Citigold Corporation Limited – Notice of General Meeting

Page 27

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Citigold Corporation Limited Proxy Form – 8 July 2013 Extraordinary General Meeting

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I/we:________________

Company Name (if applicable) _______________

Address: _________________

Suburb: ___ State: _ Post Code: ___ HIN/SRN: ________

being a shareholder/s of Citigold Corporation Limited and entitled to attend and vote hereby appoint:

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The Chairman Name of proxy - If you are not appointing the of the Meeting OR Chairman of the Meeting as your proxy please write (mark with an ‘X’) here the full name of individual or body corporate (excluding the registered Security holder) you are appointing as your proxy.

or failing the individual or body corporate named, or if no individual or body corporate is named, the Chairman of the meeting, as my/our proxy to vote in accordance with the following directions or, if no directions have been given, as the proxy sees fit at the Extraordinary General Meeting of the Company to be held on Monday 8 July, 2013 commencing at 10:00am and at any adjournment of the meeting. The chairperson intends to vote undirected proxies in favour of the resolution.

Voting directions to your proxy – please mark X to indicate your directions

ORDINARY RESOLUTIONS

Approval of the issue of Convertible Bonds and Shares upon Conversion of the Converting Bonds, to Express-Link Management Limited

For Against Abstain* ( ) ( ) ( )

If you mark the abstain box for a particular item you are directing your proxy not to vote on that item on a show of hands or on a poll and that your shares are not to be counted in computing the required majority on a poll.

PLEASE SIGN HERE This section must be signed in accordance with the instructions below to enable your directions to by implemented Individual or Security holder 1 Security Holder 2 Security Holder 3 Individual/Sole Director & Sole Director Director/Company Secretary Company Secretary

Contact Name:_____

Contact Ph (daytime):________

PROXY INSTRUCTIONS

Any appointed proxy must be a natural person.
A shareholder who is entitled to cast 2 or more votes may appoint 1 or 2 proxies to attend and vote at a meeting. If you appoint another proxy you should insert the proportion or number of your voting rights given to the proxy named in this form. If you do not insert this proportion or number then each proxy may exercise half of your votes. An additional proxy form for the other proxy will be supplied on request.
Joint holders should all sign this form. Companies should execute this form under common seal or by an officer or attorney duly authorised. If this form is executed under Power of Attorney, a certificate of non-revocation of Power of Attorney should be completed. The Power of Attorney should be sent with this form if it has not already been noted by the Company.
To be effective the proxy form must be received by the Company no later than 12 noon (AEST) on Friday 5 July 2013. The proxy form will be received by the Company if received at Citigold Corporation Limited, Level 13, 500 Queen St, Brisbane QLD 4000 or faxed to: Attention: Company Secretary, Citigold Corporation Limited, Fax: (07) 3834 0011 from outside Australia fax +61 7 3834 0011 or email to [email protected] .

AI assistant

CITIGOLD CORPORATION LIMITED — Proxy Solicitation & Information Statement 2013

64717_rns_2013-06-03_c8213f7e-26d9-4053-a099-324c98224df7.pdf

ANNOUNCEMENT

Notice of Meeting

CITIGOLD CORPORATION LIMITED NOTICE OF EXTRAORDINARY GENERAL MEETING AND EXPLANATORY STATEMENT

Corporate Directory

1. Approval of the issue of Convertible Bonds and Shares upon Conversion of the Converting Bonds, to Express-Link Management Limited

Voting Exclusion

NOTES

Time and place of meeting

Your vote is important

Voting eligibility

Voting in person

Voting by proxy

Proxy vote if appointment specifies way to vote

Transfer of non-chair proxy to chair in certain circumstances

Voting by corporate representative

Voting by attorney

Forward looking statements

Notice to persons outside Australia

Disclaimers

Privacy

Responsibility for information

Competent Person consent statement

ASIC and ASX involvement

Dear Shareholder,

Yours Sincerely,

Key dates

Table 1:

Definitions

Who is Express-Link?

Express-Link's intentions

(a) Review

(b) Intentions

Independent Expert

Assessment of Fairness

Assessment of reasonableness

Reasons why you may consider not voting in favour of the Funding Agreement

Directors’ recommendation

Table of Contents

Attachment A

1. Details of the Funding Agreement

1.1 Material Commercial Terms

Table 2:

1.2 Conditions precedent

Tranche 2:

Tranche 3 and subsequent tranches

Other terms and conditions

Events of Default

1.3 Purpose of the Funding Agreement

1.4 Independent Expert's Report

1.5 Directors' Recommendations

2. Rationale for the Funding Agreement

(a) The Convertible Bonds provide necessary funding for development of the Charters Towers gold project and growth of the Company

(d) The Funding Agreement establishes a strategic relationship with Express-Link

(f) Further equity issues permitted

2.2 Reasons why you may consider not voting in favour of the Funding Agreement

2.3 Independent Expert Considers Transaction is not fair but reasonable to Shareholders who are not associated with Express-Link

3. About Express-Link

3.1 Express-Link's intentions

(a) Review

(b) Intentions

3.2 Proposed Director if members approve the Resolutions

4. About the Company

4.1 History

4.2 Key Assets

4.3 Mineral Resources

Table 3

4.4 Current Directors

Table 4:

4.5 Current capital structure

Table 5

4.6 Top 20 Shareholders

4.7 Substantial Shareholders

Table 7:

5. Impact on the Company's Financial Position

5.1 Use of funds made available under the Express-Link Facilities

5.2 Pro forma balance sheet

(i)

CITIGOLD CORPORATION LIMITED Proxy Solicitation & Information Statement 2013

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