Proposed Variation to Terms of Convertible Loan Notes

Proposed Variation to Terms of Convertible Loan Notes

Mercator Gold Plc

MERCATOR GOLD plc

(“Mercator Gold”, “Mercator” or “the Company”)

AIM: MCR
US OTC: MTGDY

Proposed Variation to Terms of Convertible Loan Notes

London 14 September 2010

Mercator Gold plc, the diversified mineral and renewable energy development company, announces that it has today despatched notice of an extraordinary meeting (“the EM”) of holders of the unsecured convertible loan notes of principal amount £2,565,000 (“Loan Notes”) issued by the Company and constituted by a loan note instrument dated 17 October 2007 (“the Loan Note Instrument”). The purpose of the EM is to seek the approval of Loan Note holders to vary the terms of the Loan Note Instrument.

Subject to the extraordinary resolution to be put to the EM being passed, the terms of the Loan Note Instrument are to be varied as follows:

• The Loan Notes are to be repayable on 17 October 2013, a 3-year extension to the current repayment date
• Conversion of the Loan Notes at the election of Loan Note holders may take place at 1.1 pence per share at any time after the date of the EM
• The rate of interest carried by the Loan Notes is to be set at 10% per annum
• All other terms of the Loan Notes are to remain the same

The Company would retain the ability to:

• Repay the Loan Notes early, subject to the right of Loan Note holders to elect to receive repayment in shares at the conversion price of 1.1 pence per share
• Purchase Loan Notes at any price and at any time by tender, private treaty or otherwise by agreement with the relevant Loan Note holder

The EM will be held at the offices of Cobbetts LLP at 70 Gray’s Inn Road, London WC1X 8BT on Tuesday 28 September 2010 at 11.00am. A further announcement will be made following completion of the EM.

For further information please contact:

Mercator Gold plc
Michael Silver, Chairman					Tel: [phone]
Patrick Harford, Managing Director
Email: [e-mail]
Website: www.mercatorgold.com
Daniel Stewart & Company plc
Oliver Rigby					Tel: + 44 (0) 20 7776 6550
Old Park Lane Capital plc
Forbes Cutler					Tel: [phone]
Bankside Consultants Ltd
Simon Rothschild					Tel: [phone]
Barry Kaplan Associates
Larry Kaplan					Tel: [phone]