Exercise of Warrants and Update re Gold Loan

18 December 2020

GOLDSTONE RESOURCES LIMITED

("GoldStone" or the "Company")

Exercise of Warrants and Update re Gold Loan

GoldStone Resources Limited (AIM: GRL), the AIM quoted gold exploration and development company focused on bringing its Akrokeri-Homase Gold Project ("AKHM") into production, announces that it has received notice of exercise of warrants from Asian Investment Management Services Ltd ("AIMS") to subscribe for a total of 30,000,000 new ordinary shares of 1 penny each in the capital of the Company ("Ordinary Shares") (the "New Ordinary Shares"). The New Ordinary Shares are being issued at an exercise price of 3 pence per share, for a total subscription to the Company of £900,000, and relate to warrants issued pursuant to the gold loan provided by AIMS, announced on 22 June 2020. The proceeds of the warrant exercise will be used for general working capital purposes.

The New Ordinary Shares will rank pari passu with the existing Ordinary Shares and application will be made for the New Ordinary Shares to be admitted to trading on AIM ("Admission"). It is expected that Admission will become effective and dealings in the New Ordinary Shares will commence at 8.00 a.m. on 25 December 2020.

On Admission, AIMS will hold 30,000,000 Ordinary Shares in the Company representing approximately 10.65 per cent. of the Company's then issued share capital and will also hold 90,000,000 warrants to subscribe for 90,000,000 Ordinary Shares.

Update re AIMS Gold Loan

The Board has decided that, in order to preserve cash within the Company and in the expectation of commencing gold production in Q1 2021, it will defer payment of the interest due to AIMS on 31 December 2020 pursuant to the gold loan with AIMS announced on 22 June 2020 (the "Gold Loan") to 31 March 2021. Accordingly, the interest due on the outstanding balance of the Gold Loan will accrue at a rate of 17 per cent., as opposed to 14 per cent., for the period from 31 December 2020 to 31 March 2021. AIMS has agreed by way of deed of variation to the Gold Loan agreement that the deferment of such interest payment will not trigger an event of default under the agreement.  

Total Voting Rights

Upon Admission, the Company's issued ordinary share capital will consist of 281,785,967 Ordinary Shares with one voting right each. The Company does not hold any Ordinary Shares in treasury. Therefore, the total number of Ordinary Shares and voting rights in the Company will be 281,785,967. With effect from Admission, this figure may be used by shareholders in the Company as the denominator for the calculations by which they will determine if they are required to notify their interest in, or a change to their interest in, the share capital of the Company under the FCA's Disclosure Guidance and Transparency Rules.

Changes to Directors' Interests

On Admission, the dilution resulting from the issue of the New Ordinary Shares has led to the following changes in the interests of certain Directors of the Company:

* Bill Trew, the Company's Non-Executive Chairman, is Paracale Gold Limited's representative on the GoldStone Board and also a director of and a shareholder in Paracale Gold.

** Angela List, a Non-Executive Director of the Company, is a director of BCM Investment Limited

For further information, please contact:

The information contained within this announcement is deemed by the Company to constitute inside information as stipulated under the Market Abuse Regulations (EU) No. 596/2014.

About GoldStone Resources Limited

GoldStone Resources Limited (AIM: GRL) is an AIM quoted gold exploration and development company.

The Company is focused on developing the Akrokeri-Homase project in south-western Ghana, which hosts a JORC Code compliant 602,000 oz gold resource at an average grade of 1.77 g/t. The existing resource is confined to a 4km zone of the Homase Trend, including Homase North, Homase Pit and Homase South.

The project hosts two former mines, the Akrokeri Ashanti Mine Ltd, which produced 75,000 oz gold at 24 g/t recovered grade in the early 1900s, and the Homase Pit which AngloGold Ashanti developed in 2002/03 producing 52,500 oz gold at 2.5 g/t recovered. It is the Company's intention to build a portfolio of high-quality gold projects in Ghana, with a particular focus on the highly prospective Ashanti Gold Belt.