Serabi Gold : Initial partial draw down of US$5 million convertible loan facility

Microsoft Word - Initial US$2m drawdown (WEB)

PRESS RELEASE 6 JANUARY 2016

SERABI GOLD plc ("Serabi" or "the Company")

Initial partial draw down of US$5 million convertible loan facility

Serabi Gold plc (AIM:SRB, TSX:SBI), the Brazilian focused gold mining and development company, announces that that further to the news release issued on 31 December 2015, the Company has made an initial draw down of US$2 million of the interim unsecured short term working capital convertible loan facility of US$5 million ("the Loan") that has been provided by Fratelli Investments Limited ("Fratelli Investments"), the Company's major shareholder.

Interest on the Loan is chargeable at the rate of 12% per annum. The first US$2 million of the Loan is convertible at the election of Fratelli Investments into new Serabi Ordinary Shares at an exercise price of 3.6 pence per new Serabi Ordinary Share at any time. The remaining amount of the Loan, if drawdown, may be repaid by the Company at its option at any time on or before 30 June 2016. Thereafter, Fratelli Investments will have the right to convert all or part of the remaining amount of the Loan into new Serabi Ordinary Shares at an exercise price of 3.6 pence per new Serabi Ordinary Share at any time. Unless otherwise repaid or converted the Loan is for a period expiring on 31 January 2017.

Enquiries

SERABI GOLD plc

Michael Hodgson t [phone]

Chief Executive m [phone]

Clive Line t [phone]

Finance Director m [phone]

e [e-mail] www.serabigold.com

BEAUMONT CORNISH Limited

Nominated Adviser & Financial Adviser

Roland Cornish t [phone]

Michael Cornish t [phone]

PEEL HUNT LLP

UK Broker

Matthew Armitt t [phone]

Ross Allister t [phone]

Blytheweigh

UK Financial PR

Tim Blythe t [phone]

Camilla Horsfall t [phone]

Copies of this release are available from the Company's website at www.serabigold.com

Forward-looking statements

Certain statements in this announcement are, or may be deemed to be, forward looking statements. Forward looking statements are identified by their use of terms and phrases such as ''believe'', ''could'', "should" ''envisage'', ''estimate'', ''intend'', ''may'', ''plan'', ''will'' or the negative of those, variations or comparable expressions, including references to assumptions. These forward looking statements are not based on historical facts but rather on the Directors' current expectations and assumptions regarding the Company's future growth, results of operations, performance, future capital and other expenditures (including the amount, nature and sources of funding thereof), competitive advantages, business prospects and opportunities. Such forward looking statements reflect the Directors' current beliefs and assumptions and are based on information currently available to the Directors. A number of factors could cause actual results to differ materially from the results discussed in the forward looking statements including risks associated with vulnerability to general economic and business conditions, competition, environmental and other regulatory changes, actions by governmental authorities, the availability of capital markets, reliance on key personnel, uninsured and underinsured losses and other factors, many of which are beyond the control of the Company. Although any forward looking statements

contained in this announcement are based upon what the Directors believe to be reasonable assumptions, the Company cannot assure investors that actual results will be consistent with such forward looking statements.

Qualified Persons Statement

The scientific and technical information contained within this announcement has been reviewed and approved by Michael Hodgson, a Director of the Company. Mr Hodgson is an Economic Geologist by training with over 25 years' experience in the mining industry. He holds a BSc (Hons) Geology, University of London, a MSc Mining Geology, University of Leicester and is a Fellow of the Institute of Materials, Minerals and Mining and a Chartered Engineer of the Engineering Council of UK, recognizing him as both a Qualified Person for the purposes of Canadian National Instrument 43-101 and by the AIM Guidance Note on Mining and Oil & Gas Companies dated June 2009.

Neither the Toronto Stock Exchange, nor any other securities regulatory authority, has approved or disapproved of the contents of this news release.

SERABI GOLD PLC

2nd Floor, 30-32 Ludgate Hill, London EC4M 7DR This document is not intended to and does

t [phone] f [phone] e [e-mail] www.serabigold.com not amount to an invitation or inducement to

Registered Office 66 Lincoln's Inn Fields, London, WC2A 3LH Company Number 5131528 subscribe for shares in Serabi Gold plc