IONDRIVE LIMITED — Capital/Financing Update 2013

Nov 5, 2013

ASX RELEASE ASX Code: SAU

ASX ANNOUNCEMENT

6 NOVEMBER 2013

Company Announcements Office ASX Securities Limited Level 8, Exchange Plaza 2 The Esplanade PERTH WA 6000

SOUTHERN GOLD LIMITED ACN 1078 424 519

NOTICE UNDER SECTION 708AA OF THE CORPORATIONS ACT

Southern Gold Limited (ASX: SAU) (the Company) refers to its Offer Memorandum and Appendix 3B lodged with ASX today in relation to a partially underwritten three (3) for eight (8) non-renounceable pro-rata rights issue priced at $0.015 per new share (Rights Issue).

This notice is given under section 708AA(2)(f) of the Corporations Act 2001 (Cth) (the Act). The Company advises that:

• (1) the securities will be offered for issue under the Rights Issue without disclosure to investors under Part 6D.2 of the Act;

• (2) as at the date of this notice, the Company has complied with the provisions of Chapter 2M of the Act as they apply to the Company and section 674 of the Act;

• (3) as at the date of this notice there is no information that is excluded information under section 708AA(8) and (9) of the Act that has not already been disclosed to investors generally or in the Offer Memorandum and Appendix 3B lodged on 6 November 2013;

• (4) the potential effect the Rights Issue will have on the control of the Company is as follows (based on the issued share capital of the Company as at the date of this notice):

  • (a) If all shareholders take up their entitlements under the Rights Issue, the Rights Issue will have no effect on the control of the Company.

  • (b) If all Board members take up their entitlements under the Rights Issue in full (as they have undertaken to do) and Ms Nanette Anderson, Managing Director of the Company and partial underwriter of the Rights Issue, is issued the full 7,000,000 shares underwritten by her, the percentage of the total issued share capital of the Company controlled by the Board will increase from 1.9% to 3.8%.

• (5) The consequences of the potential effect on control of the Company referred to in paragraphs 4(b) above will be an increase in the voting power of the Board members by an aggregate amount equal to the percentage increase in their control of the Company’s undiluted share capital. As a result, the

Southern Gold Limited Ground Floor, Unit 1 PO Box 255 email info@southerngold.com.au telephone 08 8368 8888 ABN 30 107 424 519 229 Greenhill Road Kent Town web southerngold.com.au facsimile 08 8431 5619 Dulwich SA 5065 SA 5071

ASX RELEASE ASX Code: SAU

maximum control that the Company’s Board will in aggregate have post the Rights Issue is 3.9% (based on the issued share capital of the Company as at the date of this notice). However, this will only occur in the unlikely situation that no shareholders (with the exception of the Board members) take up their entitlements under the Rights Issue. Notwithstanding this, the Board considers that such an effect is acceptable in the circumstances as it would only occur where eligible shareholders have had an equitable opportunity to participate in the Offer.

Dated this 6[th] day of November 2013

By order of the Board

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Greg Boulton Chairman Southern Gold Limited

Ground Floor, Unit 1

Southern Gold Limited ABN 30 107 424 519

PO Box 255 Kent Town SA 5071

email info@southerngold.com.au telephone 08 8368 8888 web southerngold.com.au facsimile 08 8431 5619

229 Greenhill Road Dulwich SA 5065