TORONTO,
June 27, 2013 /CNW/ - White Tiger
Gold Ltd. ("White Tiger" or the "Company") (TSX: WTG)
announces that it has amended the terms of the bridge loan
previously announced by the Company on March
4, 2013 and amended on April 2,
2013.
Amended Terms of the Bridge
Loan
On March 4, 2013,
the Company announced that it had agreed to a US$1.5 million bridge loan facility (the
"Bridge Loan") from Unique Goals International Limited (the
"Lender"), a company beneficially owned, directly or
indirectly, by Mr. Sergey Yanchukov,
whom, at the time, was a creditor and insider of White Tiger. At
the time of the agreement, the Bridge Loan was unsecured, scheduled
to mature on April 15, 2013 and bore
interest at 15% per annum.
On April 2, 2013,
the Company announced the first amendments to the terms of the
Bridge Loan. The loan amount under the Bridge Loan was increased to
US$12,500,000. The amended
Bridge Loan was unsecured, the maturity date was extended to 60
days from the date of the amended Bridge Loan and bore interest at
15% per annum.
On June 26, 2013,
the Company and Unique amended the terms of the Bridge Loan for a
second time. Under the second set of amendments to the Bridge
Loan, the loan amount has been increased to US$25,000,000 and the maturity date has been
extended to September 15, 2013.
The Bridge Loan interest rate remains at 15% per annum. The
Bridge Loan amount will be payable in several advances (each an
"Advance"), with each Advance being provided to the Company
in accordance with a payments list agreed upon by the parties (the
"Payments List"). Subsequent Advances are subject to
the Lender approving of the individual Advance and its associated
Payments List.
The latest amendments to the Bridge Loan are
subject to the approval of the Toronto Stock Exchange
("TSX"). The Company intends to use proceeds from the
Bridge Loan to maintain operations. If the Company does not
receive the increased proceeds under the Bridge Loan, the Company
will not have sufficient funds to continue operations.
In the period since the Bridge Loan was first
agreed to, Mr. Yanchukov became the majority and controlling
shareholder of the Company. By virtue of Mr. Yanchukov's
status as an insider 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
paragraph 5.4 of MI 61-101, a formal valuation is not required as
the transaction does not fall under paragraphs (a) through (g) of
the definition of a related party transaction. In addition,
pursuant to paragraph 5.7(f), an exemption for minority approval
requirements for a related party transaction is available to the
Company as the Bridge Loan is from a related party on reasonable
commercial terms that are not less advantageous to the Company than
if the loan or credit facility were obtained from a person dealing
at arm's length with the issuer, and the loan, or each advance
under the credit facility, as the case may be, is not:
|
(a) |
convertible, directly or indirectly, into equity or voting
securities of the issuer or a subsidiary entity of the issuer, or
otherwise participating in nature; or |
|
(b) |
repayable as to principal or interest, directly or indirectly,
in equity or voting securities of the issuer or a subsidiary entity
of the issuer, |
From a TSX compliance perspective, the value of
the consideration to be received by Mr. Yanchukov will not exceed
10% of the Company's market capitalization and therefore does not
trigger the requirement under Section 501(c) for "approval by the
issuer's security holders, other than the insider or other related
party". Since the Bridge Loan constitutes a related party
transaction, 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 latest amendments to the Bridge Loan. The
Board then passed a resolution approving of the Company entering
into the amended 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 amended Bridge Loan,
the Company will not have sufficient funds to continue
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.