San Gold announces issuance of shares in payment of interest of interest on debentures - November 21, 2007

San Gold Corp. has issued 431,983 common shares of the corporation in payment of approximately $505,000 of the first year's interest owing on the corporation's $6,734,000 principal amount of issued and outstanding Series B, 10-per-cent, two-year, senior secured convertible redeemable debentures, which mature on Oct. 18, 2008. The common shares were issued at a deemed price of $1.17 per share, a 10-per-cent discount from the $1.30 closing price of the common shares on Oct. 17, 2007. The remainder of the interest owing on the debentures was satisfied by cash payments to the holders of the debentures.

As previously announced in Stockwatch by the corporation, interest on the debentures is payable annually on the first and second anniversary of the initial issuance of the debentures, which was Oct. 18, 2006. Pursuant to the terms of the debentures, holders of debentures are entitled to elect to receive interest on the debentures payable in cash or in common shares issued at a 10-per-cent discount to the market price of the common shares on the applicable interest payment date.

The common shares issued to holders of debentures who elected to receive their interest payment in common shares instead of cash are restricted from transfer for a period of four months and a day in accordance with applicable securities laws and the policies of the TSX Venture Exchange.