Pilot Gold raises C$37.5 million through bought deal financing, exercise of over-allotment option and private placements

12-23

NOT FOR DISTRIBUTION TO U.S. NEWS WIRE SERVICES OR DISSEMINATION IN THE UNITED STATES

Pilot Gold Inc. (PLG-TSX) (“Pilot Gold” or the “Company”) is pleased to announce that it has completed its previously announced bought deal financing, including the full amount of the over-allotment option, for aggregate gross proceeds of C$29,411,250 (the “Offering”). In addition, Pilot Gold has raised a further C$8,085,078 through private placements with subsidiaries of Newmont Mining Corporation (“Newmont”) and Teck Resources Limited (“Teck”), each of which has subscribed for and purchased additional securities in connection with participation rights each hold to maintain their pro rata interest in Pilot Gold.

The net proceeds of the Offering will be used to fund exploration and development of Pilot Gold’s mineral projects in Turkey and Nevada, and for general working capital purposes.

“TV Tower and Kinsley Mountain are Pilot Gold’s cornerstone projects, and this funding will allow us to continue advancing exploration and development of these key properties,” said Matt Lennox-King, President & CEO, Pilot Gold. “We appreciate the strong response to the Offering, and are pleased that Teck and Newmont – two global mining leaders – have shown confidence in our team and our projects through their investments today.” 

Lead underwriter National Bank Financial Inc., along with Canaccord Genuity Corp., CIBC World Markets Inc., Haywood Securities Inc. and Scotia Bank purchased, on a bought deal basis, 17,825,000 units of the Company (the “Units”) at a price of C$1.65 per Unit. Each Unit consists of one common share of Pilot Gold and one half of one common share purchase warrant (each whole common share purchase warrant, a “Warrant”). Each Warrant entitles the holder to acquire one common share of Pilot Gold at a price of C$2.20 until October 31, 2014. The Warrants will be listed on the Toronto Stock Exchange under the symbol "PLG.WT".

Newmont, Teck participate in concurrent private placements
Pursuant to rights granted under the arrangement agreement dated February 3, 2011 between the Company, Newmont and Fronteer Gold Inc., Newmont, the Company's largest shareholder with approximately 16.15% of the Company's issued and outstanding shares, has subscribed for and purchased 3,669,482 Units of the Company on the same terms as those issued under the Offering to maintain its pro rata interest (the “Newmont Subscription”).

Pursuant to rights granted under the TV Tower Property Joint Venture Letter Agreement dated June 20, 2012 between the Company, Teck, Teck Madencilik Sanayi Ticaret A.Ş. (“TMST”) and Orta Truva Madencilik Sanayi ve Ticaret A.Ş., TMST has subscribed for and purchased 1,230,565 Units on the same terms as those issued under the Offering to maintain its pro rata interest (the “Teck Subscription”).  TMST, a subsidiary of Teck, is the Company's joint venture partner at the Halilaga and TV Tower properties in northwest Turkey and holder of approximately 5.41% of the Company's issued and outstanding shares, Units purchased by Newmont and TMST will be subject to a four-month statutory hold period.  Proceeds of the Newmont Subscription and the Teck Subscription will be used to fund exploration and development of Pilot Gold’s mineral projects and for general working capital purposes.

The offered securities have not been registered under the United States Securities Act of 1933, as amended (the "Securities Act") or any state securities laws, and may not be offered or sold to, or for the account or benefit of, any person in the United States or a “U.S. person”, as such term is defined in Regulation S under the Securities Act, absent registration or an applicable exemption from registration requirements. This press release shall not constitute an offer to sell or the solicitation of an offer to buy nor shall there be any sale of the securities in any state in which such offer, solicitation or sale would be unlawful.

ABOUT PILOT GOLD
Pilot Gold is a gold exploration company led by a proven technical team that continues to discover and define high-quality projects featuring strong grades, meaningful size and mining-friendly addresses. Our three key assets include the TV Tower and Kinsley gold projects and a 40% interest in the Halilaga copper-gold porphyry project, each of which has the ability to drive the Company forward. For more information, visit www.pilotgold.comor contact:

Investors:
Matt Lennox-King, President & CEO
Patrick Reid, VP Corporate Affairs
Phone 604-632-4677 or Toll Free 1-877-632-4677
info@pilotgold.com

Media:
Ian Noble, Director, Corporate Communications
Phone: 604-809-8750
inoble@oxygencapitalcorp.com


All statements in this press release, other than statements of historical fact, are "forward-looking information" with respect to Pilot Gold Inc. ("Pilot Gold") within the meaning of applicable securities laws, including statements that address intended use of proceeds and timing of exploration and development plans at the Company’s mineral projects. Forward-looking information is often, but not always, identified by the use of words such as "seek", "anticipate", "plan", "continue", "planned", "expect", "project", "predict", "potential", "targeting", "intends", "believe", "potential", and similar expressions, or describes a "goal", or variation of such words and phrases or state that certain actions, events or results "may", "should", "could", "would", "might" or "will" be taken, occur or be achieved. Forward-looking information is not a guarantee of future performance and is based upon a number of estimates and assumptions of management at the date the statements are made including, among others, assumptions about future prices of gold, copper, silver, molybdenum and other metal prices, currency exchange rates and interest rates, favourable operating conditions, political stability, obtaining governmental approvals and financing on time, obtaining renewals for existing licences and permits and obtaining required licences and permits, labour stability, stability in market conditions, availability of equipment, accuracy of any mineral resources and mineral reserves, successful resolution of disputes and anticipated costs and expenditures. Many assumptions are based on factors and events that are not within the control of Pilot Gold and there is no assurance they will prove to be correct.

Such forward-looking information, including, but not limited to, anticipated use of proceeds and timing of exploration and development plans at the Company’s mineral projects, involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievement of Pilot Gold to be materially different from any future results, performance or achievements expressed or implied by such forward-looking information.  Such factors include, among others, risks related to the interpretation and actual results of historical production at certain of our exploration properties, reliance on technical information provided by our joint venture partners or other third parties as related to any of our other exploration properties; changes in project parameters as plans continue to be refined; current economic conditions; future prices of commodities; possible variations in grade or recovery rates; failure of equipment or processes to operate as anticipated; the failure of contracted parties to perform; delays in permitting; possible claims against the Company or its joint venture partners; labour disputes and other risks of the mining industry; delays in obtaining governmental approvals, financing or in the completion of exploration as well as those factors discussed in the (final) short form prospectus of the Company dated October 25, 2012, in the section entitled "Risk Factors", under Pilot Gold’s SEDAR profile at www.sedar.com.

Although Pilot Gold has attempted to identify important factors that could cause actual actions, events or results to differ materially from those described in forward-looking information, there may be other factors that cause actions, events or results not to be as anticipated, estimated or intended. There can be no assurance that such information will prove to be accurate as actual results and future events could differ materially from those anticipated in such statements. Pilot Gold disclaims any intention or obligation to update or revise any forward-looking information, whether as a result of new information, future events or otherwise. Accordingly, readers should not place undue reliance on forward-looking information. Further details relating to Pilot Gold are also available in our Annual Information Form, available under Pilot Gold’s SEDAR profile at www.sedar.com