Dixie Gold Inc. Provides Update Regarding Western Hemp Corp.

VANCOUVER, Dec. 10, 2019 - Dixie Gold Inc. (TSX VENTURE: DG) ("Dixie Gold" or the "Corporation" or the "Issuer") provides the following update with respect to Western Hemp Corp. (see news release, Clean Commodities Corp. Announces Intent to Spin-Out Licensed Hemp Producer to Shareholders, dated September 23, 2019).

The Corporation (previously Clean Commodities Corp.) has been subject to a restrictive undertaking imposed by the Corporation's listed exchange (being for factual clarity, the TSX Venture Exchange) since September 24, 2019 (the "Regulatory Restriction"), the subject matter of which relates to Western Hemp Corp. ("WHC").

The Regulatory Restriction prohibits the Issuer, as a shareholder of WHC in its current form, from: 1) making further investment in or on behalf of WHC beyond a nominal prescribed amount (expended); and 2) imposes a prohibition against the commencement of commercial operations by WHC.

Despite best efforts by the Corporation, the imposed regulatory constraints are, in the view of the Corporation, terminal to the Issuer's ability to reasonably advance its shareholding in WHC as said constraints amount, in the Corporation's opinion, to a regulatory prohibition against funding and operating WHC in a commercially-viable near-term manner.

Ongoing capital market deterioration with respect to domestic entities licensed under the Cannabis Act (Canada) has further challenged the situation with respect to the Corporation being able to assist in regards to the potential sourcing of external third-party capital, especially given that the present-day commercial operations of WHC are currently under an operating prohibition as required by the TSX Venture Exchange.

As a result of the foregoing, the Corporation advises that it is not reasonably able to advance its investment in WHC and therefore will be discontinuing further involvement with respect to WHC, including, but not limited to, discontinuing plans to create a publicly traded company thereof.

The Corporation expects to incur a non-material impairment related to its investment in WHC.

About Dixie Gold Inc.

Dixie Gold Inc. (TSXV:DG) is a publicly-traded exploration company involved in a diverse portfolio of exploration projects including gold, lithium and uranium assets in Canada. For more information, please visit www.dixiegold.ca.

Signed,

Ryan Kalt, Chief Executive Officer

Forward-Looking Statements 

This news release contains forward-looking statements. Forward-looking statements address future events and conditions and therefore, involve inherent risks and uncertainties. Actual results may differ materially from those currently expected or forecast in such statements.

Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

SOURCE Dixie Gold Inc.