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Muddy Waters Responds to GT Gold's Blatantly False and Inaccurate Statements

February 16, 2021

Muddy Waters Capital LLC (“Muddy Waters”) has investment authority over 13,289,400 shares representing 10.204% of the outstanding shares of GT Gold Corp (ticker: GTT.V). Despite Muddy Waters’ lack of faith in the current board of directors, which is led by the ex-Marc Rich executive Ashwath Mehra, we continue to buy shares in the open market. We firmly reiterate our intention to vote against the current board of directors and support the slate of directors proposed by K2 & Associates.

GT Gold’s January 29, 2021 response to our press release was filled with lies and misleading statements. In order to dispel this misinformation, we will address three misleading – or outright false – statements that GT Gold made. It is important to note that Mr. Mehra offered us an opportunity to participate in the dilutive and abusive financing. We felt that this was a thinly veiled attempt at buying our acquiescence. Despite our desire to increase our GT Gold position, we declined to participate in this tainted financing, and instead purchased additional shares at higher prices in the open market.

False / Misleading Statement #1: GT Gold stated that "the [Muddy Waters] proposal contained highly unusual and restrictive off-market rights" and the "price [offered by Muddy Waters] was at market and not at a premium".

This is false. In an October 22, 2020 email from Muddy Waters' Chief Investment Officer, Carson Block, to Mr. Mehra, Mr. Block stated that Muddy Waters was willing to provide "financing at CAD$1.35 per share on terms that are otherwise identical to those you have proposed " (emphasis added).

In other words, in that email we offered to pay an 8% premium on otherwise identical terms to the Company's November offering. GT Gold’s November 2020 offering was unnecessarily more dilutive and at a lower price. We therefore conclude that its primary purpose was to steer a disproportionate number of shares into the hands of Mr. Rutherford and Mr. Mehra.

Problematic Statement #2: GT Gold states “Muddy Waters [has a] reputation as an activist short seller, rather than as a supportive long-term investor.”

Presumably Mr. Mehra had a different view of our reputation when he proposed that, should we have agreed to participate in the dilutive and abusive offering, we issue a press release that he drafted. Miscalculating that we are as conniving as he is, Mr. Mehra sent us the below draft press release statement:

“Muddy Waters is well known for identifying opportunities through performing extensive due diligence in all our investments,” reflected Carson Block, Founder of Muddy Waters Research. “In the case of GT Gold, we have performed our due diligence and believe this to be one of the most exciting assets in the mining industry and are happy to provide capital to advance the project and expand its potential.”

Problematic Statement #3: The Company stated that it wanted to avoid "creating a new control block.”

We would like to remind GT Gold and its current Board that after we rejected Mr. Mehra’s unethical financing proposal, we purchased shares that caused us to exceed 10% ownership anyway.

We would also like to remind Mr. Mehra that his business partner Mick McMullen sold millions of GT Gold shares over the last two years (many of which we likely purchased on the open market). This likely makes Mr. McMullen the single largest on-market seller of stock since the Company was founded. Had he not been so eager to sell GT Gold shares, Mr. McMullen and Mr. Mehra would have owned the largest block of shares in the Company.

Often times, self-interest clouds good judgment, and the shareholders of GT Gold deserve better.

For that reason, we intend to vote against the current board of directors, and in particular, Mr. Mehra and Mr. Rutherford, and we reiterate our support for the slate of directors proposed by K2 & Associates.