DSM Deep South Resources Inc

Dacha Strategic Metals Inc. ("Dacha" or the "Company") (TSX
VENTURE:DSM)(OTCQX:DCHAF) reports that, as a result of discussions with the TSX
Venture Exchange, at the meeting of shareholders (the "Meeting") scheduled to be
held today, at 10:00 a.m., Dacha will seek the approval of disinterested
shareholders with respect to a resolution confirming termination payments to
certain executive consultants of Dacha and authorizing the grant of a general
security interest over all the assets of Dacha Strategic Metals Ltd. (the
"Subsidiary"), a direct wholly-owned subsidiary of Dacha, to secure such
payments. Dacha also announced that it will propose an amendment to the
Company's 10% rolling stock option plan (the "Option Plan") to make it a fixed
plan and to make certain amendments to the termination provisions of the Option
Plan, as more particularly described below. 


Grant of Security Interest 

In accordance with the resolution agreement (the "Resolution Agreement") dated
as of November 12, 2012 among Dacha, Goodwood Inc. ("Goodwood") and others, as
announced by Dacha in a press release on the same date, certain executives and
consultants (the "Executive Consultants") of Dacha who had change of control
termination arrangements with Dacha have agreed to reduce the amounts payable to
them such that an aggregate of $4.85 million (the "Termination Payments") will
be paid by Dacha to those executives and consultants in connection with the
termination of their prior arrangements on a pro-rated basis as outlined in the
Resolution Agreement: 


The Resolution Agreement provides that the Termination Payments must be paid by
Dacha as soon as reasonably practicable following the conclusion of the Meeting
based upon its cash availability, provided that the Termination Payments must be
fully paid by Dacha no later than four months following the conclusion of the
Meeting (the "Maturity"). 


The Resolution Agreement contemplates that Dacha will grant (and cause the
applicable subsidiary or subsidiaries to grant) in favour of the Executive
Consultants, as soon as possible, a security interest on rare earth inventory to
secure the Termination Payments as may be allowable by applicable regulatory
authorities and/or in accordance with applicable law and regulations, subject to
the security documentation related thereto being in a form satisfactory to
Dacha's counsel and Goodwood's counsel, each acting reasonably. 


Accordingly, Dacha will provide promissory notes (the "Notes") to each of the
Executive Consultants in respect of the obligations of Dacha to pay the
Termination Payments. The Notes are non-interest bearing unless the Company
fails to pay the Termination Payments by the Maturity or on the occurrence of an
event of default. Events of default under the Notes and the GSI (as described
below) include failure to pay the Termination Payments by the Maturity, breach
of covenants, ceasing to carry on business, as well as a bankruptcy event. The
obligations owed to the Executive Consultants under the Notes will be guaranteed
by the Subsidiary pursuant to a guarantee (the "Guarantee"). As security for the
obligations of the Subsidiary under the Guarantee, the agent for the Executive
Consultants will be issued a general security interest (the "GSI") by the
Subsidiary under which the agent will be granted a security interest in all the
present and after acquired property of the Subsidiary (the "Collateral"). Until
an event of default occurs, the Subsidiary will have the right to possession and
enjoyment of the Collateral for the purpose of conducting the ordinary course of
its business. After the occurrence of an event of default, the GSI provides the
Executive Consultants with certain rights and remedies with respect to the
Collateral.


Amendments to Dacha's Stock Option Plan 

Under the current provisions of Dacha's Option Plan, the maximum number of
common shares issuable from time to time under the Option Plan is equal to 10%
of the number of issued and outstanding common shares of Dacha at the date on
which an option is effectively granted. Pursuant to the policies of the TSX
Venture Exchange, because it is a rolling option plan, Dacha is required to
obtain shareholder approval for the Option Plan at the Meeting. Instead of
re-approving the Option Plan, Dacha will be proposing that the Option Plan be
amended to fix the number of common shares of the Company issuable under the
Option Plan at a maximum of 7,512,671 (i.e. 10% of the current shares issued and
outstanding of Dacha).


As contemplated by the Resolution Agreement, Dacha will also be proposing that
the Option Plan be amended to provide that (i) upon the resignation of the
departing directors and termination of the Executive Consultants as directors
and/or officers, as applicable, the options previously granted to each of them
as directors, officers and/or consultants, to the extent such options originally
had an expiry date of later than November 28, 2013, shall remain exercisable
until November 28, 2013, and (ii) in the event any other officer, employee or
consultant of the Company is terminated within 90 days of November 12, 2012, all
options granted to such officer, employee or consultant, to the extent such
options originally had an expiry date more than 12 months following the date of
termination, shall remain exercisable for 12 months from the date of
termination. 


The resolution to re-approve the Option Plan at the Meeting will be amended to
reflect the foregoing amendments.


About Dacha

Dacha Strategic Metals Inc. is an investment company focused on the acquisition,
storage and trading of strategic metals with a primary focus on Rare Earth
Elements. Dacha is in the unique position of holding a commercial stockpile of
Physical Rare Earth Elements. Its shares are listed on the TSX Venture Exchange
under the symbol "DSM" and on the OTCQX exchange under the symbol "DCHAF". 


Except for statements of historical fact relating to the Company, certain
information contained herein constitutes "forward-looking information" under
Canadian securities legislation. Forward-looking information includes, but is
not limited to, statements with respect to the Company's ability to trade in
rare earth elements, the realization value of Dacha's physical inventory
portfolio, proposed investment strategy of the Company, and general investment
and market trends. Generally, forward-looking information can be identified by
the use of forward-looking terminology such as "plans", "expects" or "does not
expect", "is expected", "budget", "scheduled", "estimates", "forecasts",
"intends", "anticipates" or "does not anticipate", or "believes", or variations
of such words and phrases or statements that certain actions, events or results
"may", "could", "would", "might" or "will be taken", "occur" or "be achieved".
Forward-looking statements are based on the opinions and estimates of management
as of the date such statements are made. Forward-looking information is subject
to known and unknown risks, uncertainties and other factors that may cause the
actual results, level of activity, performance or achievements of Dacha to be
materially different from those expressed or implied by such forward-looking
information. Although management of Dacha has attempted to identify important
factors that could cause actual results to differ materially from those
contained in forward-looking information, there may be other factors that cause
results not to be as anticipated, estimated or intended. There can be no
assurance that such statements will prove to be accurate, as actual results and
future events could differ materially from those anticipated in such statements.
Accordingly, readers should not place undue reliance on forward-looking
information. Dacha does not undertake to update any forward-looking information,
except in accordance with applicable securities laws.


Certain information on parties other than Dacha contained in this press release
has been obtained or quoted from publicly available sources, independent
publications, media articles third party websites (collectively, the
"Publications"). In certain cases, these sources make no representations as to
the reliability of the information they publish. Further, the analyses and
opinions reflected in these Publications are subject to a series of assumptions
about future events. There are a number of factors that can cause the results to
differ materially from those described in these publications. None of the
Company or its representatives independently verified the accuracy or
completeness of the information contained in the Publications or assume any
responsibility for the completeness or accuracy of the information derived from
these Publications. 


FOR FURTHER INFORMATION PLEASE CONTACT: 
Dacha Strategic Metals Inc.
Scott Moore
President and CEO
(416) 861-5903
smoore@dachametals.com
www.dachametals.com

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