IONDRIVE LIMITED — Capital/Financing Update 2009

Mar 9, 2009

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9 March 2009

Issue of shares to Director under Rights Issue

Southern Gold Ltd (ASX:SAU) refers to its recent 1 for 3 Rights Issue at 5 cents per share that closed on 27 January 2009 ( Rights Issue ).

It has recently come to the company’s attention that 950,000 shares forming part of the shortfall of the Rights Issue were issued to Chairman, Greg Boulton, inadvertently in breach of Listing Rule 10.11.

Listing Rule 10.11 provides that shares must not be issued to a Director without shareholder approval unless it comes within one of the specified exemptions in Listing Rule 10.12. Whilst entitlements under a pro‐rata rights issue come within one of these exemptions, any additional shares subscribed for under the shortfall of the Rights Issue do not. Mr Boulton was not aware that the exemption did not extend to the additional shortfall shares when he applied for them.

Upon application by the Company, ASX has agreed to allow Mr Boulton to sell the shares on market, subject to the following conditions:

• a) the shares must be sold on market by 31 March 2009;

• b) in order that Mr Boulton does not profit from the sale of the shares, the net proceeds of the sale above 5 cents (being the subscription price of those shares) will be donated to the Salvation Army; and

• c) if the shares are sold on market at less than 5 cents per share, Mr Boulton will bear the loss.

For further information please contact:

Nick Harding Company Secretary Phone: +61 (0) 8 8368 8888 Fax: +61 (0) 8 88368 8899

Southern Gold Limited 47 Tynte Street PO Box 1016 ABN 30 107 424 519 North Adelaide North Adelaide South Australia 5006 South Australia 5006

email: info@southerngold.com.au telephone 08 8368 8888 www:southerngold.com.au facsimilie 08 8368 8899