White Tiger Announces a US$1.5 Million Bridge Loan, an Update on Discussions with VTB Capital plc and Postponed Director Resignation

TORONTO, March 4, 2013 /CNW/ - White Tiger Gold Ltd. ("White Tiger" or the "Company") (TSX: WTG) announces that it has entered into a US$1.5 million bridge loan (the "Bridge Loan"); is providing an update on discussions with VTB Capital plc ("VTB Capital"); and that a Director has postponed the effectiveness of his resignation until today.

Bridge Loan

The Company agreed to a US$1.5 million bridge loan (the "Bridge Loan") from Unique Goals International Limited (the "Lender"), a company beneficially owned, directly or indirectly, by Mr. Sergey Yanchukov, a creditor and insider of White Tiger. The Bridge Loan is unsecured, matures on April 15, 2013 and bears interest at 15% per annum.  The loan amount will be payable in two advances, with each advance being provided in accordance with a payments list agreed upon by the parties (the "Payments List").  The first advance, in the amount of US$800,000, will be paid upon the Bridge Loan receiving TSX approval.  The second advance, in the amount of US$700,000, will be paid on or near March 7, 2013 and is subject to the Lender and White Tiger's Board approving the second advance and the associated Payments List.

The Company intends to close the Bridge Loan within one business day of receiving the approval of the Toronto Stock Exchange ("TSX") as the Company requires the funding in order to maintain operations.  If the Company does not receive one or more of the advances, the Company will not have sufficient funds to continue operations.

By virtue of Mr. Yanchukov's status as an insider of the Company (as a shareholder holding more than 10% of the issued and outstanding common shares of the Company), the provision of the Bridge Loan constitutes a related party transaction under Multilateral Instrument 61-101 Protection of Minority Security Holders in Special Transactions ("MI 61-101"). However, pursuant to paragraphs 5.5(a) and 5.7(1)(a) of MI 61-101, an exemption from the formal valuation and minority approval requirements for a related party transaction is available to the Company as the fair market value of the consideration for the Bridge Loan does not exceed 25% of the Company's market capitalization.  As at the close of business on February 28, 2013 (being the last business day of the calendar month preceding the calendar month in which the loan agreement was entered into) the Company had 481,588,164 common shares outstanding and the closing price of the common shares on that day was C$0.055.  Accordingly, the market capitalization of the Company at that time was C$26,487,349 and the fair market value of the consideration for the Loan (being the interest on the Loan) was US$25,890 (C$26,592 using the Bank of Canada US/Canada exchange rate as of March 1, 2013) or approximately 0.10% of the Company's market capitalization.  The Bridge Loan and its related party transaction component is also disclosed in the Company's material change report which will be filed on SEDAR on March 4, 2013.

In addition, since the Bridge Loan constitutes a related party transaction, the Company's board of directors (the "Board") formed a special committee (the "Special Committee") comprised of independent directors for the purpose of reviewing and approving the terms of the Bridge Loan.  After its review, the Special Committee recommended that the Board approve of the Bridge Loan.  The Board then passed a resolution approving of the Company entering into the Bridge Loan.

The Company is continuing to review additional financing alternatives to ensure its ability to continue operations.  However, if the Company does not secure additional financing prior to maturity of the Bridge Loan, the Company will not have sufficient funds to continue operations.

Update on VTB Facility

The Company also announces that it is in continued discussions with VTB Capital plc ("VTB Capital") on the status of the US$150 million senior secured term loan facility (the "VTB Facility") entered into between the Company's wholly-owned subsidiary Diascia Investments Limited ("Diascia") and VTB Capital on February 2, 2012 and amended and restated on March 7, 2012.

On December 28, 2012, the Company announced that it did not expect to meet the December 31, 2012 gold sales covenant under the VTB Facility and that VTB Capital was notified to ensure that any potential concerns of VTB Capital were addressed and so that the Company could continue to have access to the remaining US$21.0 million under the VTB Facility.

On January 11, 2013, the Company announced final gold production for 2012 of 18,261 ounces.  The resulting failure by the Company to meet the December 31, 2012 gold sales covenant constituted an event of default under the VTB Facility and should a waiver by or an agreement with VTB Capital not be granted or reached, VTB Capital could attempt to realize its security under the VTB Facility.  Security for the VTB Facility includes guarantees of the Russian subsidiaries, as well a pledge by Diascia of its participatory interests in the Company's Russian subsidiaries and pledges by White Tiger and Diascia Holdings (BVI) Ltd. of their respective shareholdings in Diascia.

On February 21, 2013, Diascia received a letter from VTB Capital stating that all the rights and remedies now or at any time in the future available to VTB Capital under the VTB Facility are hereby reserved. To date, the Company has not received any notice from VTB regarding any intent to realize its security under the VTB Facility.

Postponed Director Resignation

On February 22, 2013, White Tiger announced that Mr. Ram Ramachandran was resigning as a director effective February 28, 2013.  Mr. Ramachandran postponed his resignation so that he could serve on the Special Committee.  His resignation has taken effect as of March 4, 2013.

Jim McBurney, CEO of White Tiger, said, "On behalf of the Board of Directors, I would like to thank Mr. Ramachandran for his exemplary service to the Company during this critical juncture in the Company's operations."

About White Tiger

White Tiger Gold Ltd. is a TSX-listed mining and exploration company, focused on the development of mineral resources in the Russian Federation.

Caution Concerning Forward-Looking Information

This news release contains forward looking statements within the meaning of the United States Private Securities Litigation Reform Act of 1995 and forward-looking information within the meaning of applicable Canadian securities laws (collectively, "forward-looking statements") relating, but not limited to, the Company's expectations, intentions and beliefs (including, without limitation, statements regarding, the Bridge Loan (including the timing of advances thereunder and the terms thereof), the Company's financial position, financial alternatives and the Company's ability to continue operations and the VTB Facility (including the occurrence of an event of default thereunder and its potential effect on the Company)). Words such as "may", "will", "should", "anticipate", "plan", "expect", "believe", "estimate" and similar terminology are used to identify forward-looking statements. Such statements are based on assumptions, estimates, opinions and analysis made by the management of the Company in light of their experience, current conditions and their expectations of future developments as well as other factors which they believe to be reasonable and relevant. Forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause actual results to differ materially from those expressed or implied in the forward-looking statements. Risks and uncertainties that may cause actual results to vary include but are not limited to: the Company's inability to obtain additional financing on acceptable terms or at all; the Company's inability to obtain TSX approval of the Bridge Loan in a timely manner or at all; the Company's ability to negotiate a waiver or agreement with VTB Capital in respect of the event of default under the VTB Facility; changes in equity and debt markets; inflation; uncertainties relating to the availability and costs of financing needed to complete exploration, development and production activities; failure to establish estimated mineral resources or mineral reserves (the Company's mineral resource and mineral reserve figures are estimates and no assurances can be given that the indicated levels of gold will be produced); exploration costs varying significantly from estimates; delays in the exploration and development of, and/or commercial production from, the properties in which the Company has an interest; unexpected geological or hydrological conditions; the speculative nature of mineral exploration and development, including the uncertainty of reserve and resource estimates; operational and technical difficulties, including the failure of major mining and/or milling equipment; the ability of the Company to service its existing debt facilities; fluctuations in gold and other commodity prices; the existence of undetected or unregistered interests or claims, whether in contract or in tort, over the property of the Company; success of future exploration and development initiatives; competition; operating performance of facilities; environmental and safety risks, including increased regulatory burdens, seismic activity, weather and other natural phenomena; inability to, or delays in, obtaining necessary permits and approvals from government authorities; risks relating to labour; and other exploration, development and operating risks; changes to and compliance with applicable laws and regulations, including environmental laws; political, economic and other risks arising from the Company's activities in Russia; fluctuations in foreign exchange rates; and those risks set out in the Company's public documents filed on SEDAR. Although the Company believes that the assumptions and factors used in preparing the forward-looking information are reasonable, undue reliance should not be placed on such information, which only applies as of the date of this news release, and no assurance can be given that such events will occur in the disclosed time frames or at all.

Any forward-looking statement speaks only as of the date on which it is made and, except as may be required by applicable laws, the Company disclaims any intent or obligation to update any forward-looking statement, whether as a result of new information, future events or results or otherwise. Although the Company believes that the assumptions inherent in the forward-looking statements are reasonable, forward-looking statements are not guarantees of future performance and accordingly undue reliance should not be put on such statements due to the inherent uncertainty therein.

SOURCE: White Tiger Gold Ltd.

For further information:

Contact:

White Tiger Gold Ltd. Jim McBurney, Chief Executive Officer info@whitetigergold.com

Profil de l'entreprise

White Tiger Gold Ltd.

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