San Gold Corporation

NEWS RELEASE 10-03

Merit Mining Corp. Signs Subscription Agreement with

Hong Kong Huakan Investment Co., Limited

April 20, 2010 – Vancouver, British Columbia. Further to the previously announced Memorandum of Understanding between Merit Mining Corp. (TSX-V:MEM) (“Merit”) and Tianjin Huakan Group Co. Ltd. (“Tianjin”), Merit announces that it has signed a Subscription Agreement with Hong Kong Huakan Investment Co., Limited (“Huakan”), a subsidiary of Tianjin, whereby Huakan will subscribe for 27,955,223 common shares of Merit for aggregate proceeds of $15,500,000, subject to due diligence, shareholder and regulatory approval (the “Offering”).

Under the terms of the Subscription Agreement, the Offering will be completed in two tranches. The first tranche of $9,500,000, priced at $0.50 per share, will be completed as soon as possible but no later than May 31, 2010. The second tranche of $6,000,000, priced at $0.67 per share, will be completed as soon as possible after the closing of the first tranche, but in any event no later than June 30, 2010.

The proceeds of the Offering will be used to:

(i) pay approximately $350,000 to unsecured creditors in connection with Merit’s proposal under the Bankruptcy and Insolvency Act (Canada) (the “BIA Proposal”);

(ii) repay all outstanding principal amounts and accrued interest of approximately $4.39 million (assuming the first tranche closes on May 31, 2010) in the aggregate to extinguish debt owed to Wega Mining AS (“Wega”) and Munday Home Sales Ltd. (“Munday”);

(iii) pay any and all accrued and unpaid interest in arrears of approximately $442,000 (assuming the first tranche closes on May 31, 2010) to the holders (the “Jory Debentureholders”) of debentures (the “Jory Debentures”) issued pursuant to the Trust Indenture dated July 21, 2008 (“Trust Indenture”) between Merit and Computershare Trust Company of Canada;

(iv) to advance the Greenwood Gold project, located near Greenwood, BC and the J&L project, located near Revelstoke, BC; and

(v) for general corporate purposes in the ordinary course of business.

“The Huakan investment will enable Merit to return to its vision of becoming an intermediate sized mining company with its initial focus in British Columbia. Merit’s management looks forward to working with Huakan’s mine operating and technical staff in the development of its projects", said Fred Sveinson, President and CEO of Merit.

Jiang Chen, Chairman of the board of Huakan, said "The investment in Merit by Huakan will be a win-win situation. Huakan intends to be a responsible and long-term investor. I believe that Merit will have a great future".

In connection with the execution of the Subscription Agreement, Merit has appointed Mr. Deli Tian to its board of directors, subject to approval of the TSX Venture Exchange (“TSXV”). Upon closing of the first tranche, the parties have agreed, subject to TSXV approval, to appoint a second nominee of Huakan to Merit’s board of directors and a designate of Huakan as Chief Financial Officer. Following closing of the first tranche, Merit will also call a shareholders’ meeting to facilitate the appointment of a third nominee of Huakan to its board of directors.

The closing of the first and second tranches will be conditional on customary terms and conditions, including certain approvals of the People’s Republic of China, as well as conditions that the amounts owed under the BIA Proposal and to Wega and Munday are extinguished, and the interest in arrears owed to the Jory Debentureholders is paid. In addition, it is a condition of closing that the Jory Debentureholders approve an extraordinary resolution:

(i) to extend the term of the Jory debentures by three years to July 21, 2014;

(ii) to modify the conversion terms of the Jory Debentures so that they are convertible on the fourth and fifth year of the term as they are in the third year ($20 per share);

(iii) to provide for no conversion in the sixth and final year; and

(iv) to modify the redemption terms of the Jory Debentures to delete the 5% Redemption Premium set out in the Trust Indenture so that the Jory Debentures may be redeemed upon payment of the principal, together with accrued and unpaid interest, with no payment of premium.

Subject to regulatory approval and registration exemptions, Merit will pay a finder’s fee of 3% (payable as to 2% in cash and 1% in shares) and 5% in warrants, exercisable at the applicable subscription price of the subscription amount.

Merit Mining Corp.

Signed “Fred Sveinson”

Fred Sveinson, President & CEO