SG Spirit Gold and Pangea Energy Corp. to Combine Businesses

VANCOUVER, BRITISH COLUMBIA--(Marketwired - April 8, 2013) -

NOT FOR DISSEMINATION IN THE UNITED STATES OR FOR RELEASE TO U.S. NEWSWIRE SERVICES

SG Spirit Gold Inc. (TSX VENTURE:SG) ("SG Spirit" or the "Company") is pleased to announce that it has entered into a Letter of Intent dated April 5, 2013 (the "LOI") with Pangea Energy Corp. ("Pangea") to combine their businesses to create a well-funded, growth oriented, oil & gas company (the "Transaction"). Pangea is a private British Columbia corporation with its head office located in Lakewood, Colorado and has interests in oil & gas properties located in Romania and is in negotiation to acquire producing and non-producing properties in the United States. The two companies have agreed to combine on the basis of one common share of SG Spirit being issued for each outstanding share of Pangea. There are currently 41,822,676 Pangea shares outstanding and it is anticipated that prior to the closing of the Transaction a further 1,428,571 Pangea shares may be issued. As part of the Transaction, and prior to any SG Spirit common shares being issued to Pangea shareholders, SG Spirit will consolidate its issued and outstanding common shares on the basis of one post-consolidation common share for every four common shares outstanding such that SG Spirit will have approximately 2,378,642 common shares outstanding.

The Transaction is subject to the execution of a definitive agreement (the "Definitive Agreement"), approval of the TSX Venture Exchange (the "Exchange"), approval of the SG Spirit and Pangea shareholders and other conditions customary for a transaction of this nature. There can be no assurance that the Transaction will be completed as proposed or at all. The Transaction will constitute a reverse takeover under Exchange policies.

Transaction Highlights

The following are the highlights of the terms and conditions of the Transaction:

• SG Spirit common shares to be consolidated on a four for one basis.
• SG Spirit to issue shares to Pangea shareholders on the basis of one common share of SG Spirit being issued for each outstanding share of Pangea. All options and warrants of Pangea will be converted into equivalent securities of SG Spirit on the same conversion ratio.
• The transaction must be approved by SG Spirit and Pangea shareholders.
• Completion of the transaction is expected to occur prior to July 31, 2013.

It is anticipated that SG Spirit and Pangea will complete a business combination by way of an amalgamation or other similar form of transaction whereby SG Spirit will acquire all of the issued and outstanding shares of Pangea and Pangea will become a wholly-owned subsidiary of SG Spirit. It is anticipated that a special meeting of shareholders of SG Spirit will be held in July 2013 to approve the Transaction. Full details of the Transaction will be included in the Definitive Agreement and Management Information Circular to be filed with the regulatory authorities and mailed to SG Spirit shareholders in connection with the special meeting and in accordance with applicable securities laws.

On completion of the Transaction, J.C. Whorton Jr. will become Chief Executive Officer of the combined company, Richard S. Shuster will become Chief Operating Officer of the combined company and Arthur L. Angeli will become Chief Financial Officer of the combined company. The Board of Directors of the combined company will consist of J.C. Whorton, Richard S. Shuster, Mark Morabito, Dan Kriznic, Kia Besharat and Richard Meloff. A biography of each of the senior executive officers and directors is set forth below.

J.C. Whorton Jr., CTA - Mr. Whorton is a senior level energy professional with over thirty-five years of experience spanning all segments of the corporate value chain from both the physical and financial perspective. This experience and his leadership positions with six Fortune 500 companies has provided him with the opportunity of working with many of the world's leading energy companies at the executive and board level. Mr. Whorton brings over fifteen years of extensive upstream exploration & production (E&P) operational experience to Pangea having served as COO and Director of a publicly traded acquisition-based E&P company that operated over 250 oil and gas wells in a multi-state region. Mr. Whorton also served as VP of Land and a member of the Executive Exploration Committee of an E&P company that owned and operated 11 land based drilling rigs operating from 7,000' to 15,000'. Mr. Whorton holds a M.A. in Public Administration from Oklahoma City University and a B.A. in Political Science from the University of Oklahoma.

Richard S. Shuster, P.E. - Mr. Shuster is a Registered Professional Engineer (Petroleum) with more than 35 years of experience over a wide spectrum of the oil and gas industry, including major and independent producing companies as well as service and equipment companies. His background includes management, engineering, negotiations, operations, investor relations, and business analysis. Mr. Shuster has practical knowledge of emerging and growing companies and has developed specialized financing concepts for large projects. During his career he has built and/or affected change management strategies for numerous companies such as Grace Petroleum, Kenai Oil & Gas, and Ultra Petroleum Corporation.

Arthur L. Angeli, MA, MBA, CPA - Mr. Angeli is a financial and accounting energy professional with over 30 years of experience. During his tenure in the energy industry, he has developed numerous creative concepts for financing oil and gas M&A activity as well as exploration and exploitation drilling and development programs. Mr. Angeli was instrumental in the financial turnaround for Basin Exploration as well as subsequently guiding the company through the IPO process. Following his successful endeavors at Basin, Mr. Angeli joined Ultra Petroleum Corporation where his experience and expertise took a financially challenged company through restructuring, thus setting the direction for the company stock to eventually split and then climb to over $100/share. Mr. Angeli holds a BA in accounting from the University of Northern Colorado and a Masters in accounting as well as a Masters in Business Administration, both from Colorado State University.

Mark J. Morabito, BA, JD - Mr. Morabito has over 15 years' experience in public markets with a strong focus on junior mining with extensive experience in capital-raising and corporate development. Mr. Morabito founded and has been the principal driving force behind a number of successful resource development companies including Alderon Iron Ore Corp, Excelsior Mining Corp and others. He led the team that struck an off-take agreement with Hebei, China's largest steel producer, worth over $400 million. He is also the founder of Forbes West Management Corp. which provides various services to companies in the junior resource sector. Mr. Morabito has a BA from Simon Fraser University and completed his J.D. at the University of Western Ontario.

Dan Kriznic, CA - Mr. Kriznic is the Executive Vice President and Chief Financial Officer for the Eminata Group. The group is involved in various business verticals including education, real estate, on-line marketing, senior care services and public storage. The brands in the education vertical collectively represent Canada's largest private for profit education group. He has led the Eminata Group through various strategic school acquisitions and integrations including CDI College and University Canada West. Dan also plays a key role in the company's real estate group and has negotiated and financed real estate deals for various commercial properties throughout North America. Prior to joining the Eminata Group in January 2009, Dan was a Senior Manager at Deloitte & Touche LLP where he served both the private and public sectors in the fields of education, forestry, retail and manufacturing. During his time at Deloitte he was the lead person to assist his clients with assurance, advisory, mergers and acquisitions, restructuring, consulting and tax planning. He was named Vancouver's Top 40 under 40 for 2010 and holds various other business achievements including the Governor General Award for highest academic standing in his graduating class. He is a Chartered Accountant.

Kia Besharat, MSc - Mr. Besharat is a Managing Director at Ubequity Capital Partners, a leading global merchant and investment bank. Ubequity spearheads the development and business acceleration of select public and private growth-stage companies in the media, technology, financial services, oil & gas, real estate and natural resource sectors. Prior to assuming his role at Ubequity, Mr. Besharat worked as a financial analyst in New York. He has extensive capital markets experience including advisory, M&A, restructuring, corporate finance, and financial due diligence. Mr. Besharat is a founder and shareholder in global private equity funds, hedge funds and debt funds. He also serves on the Board of Direct Media Technologies, a highly profitable Internet media company. Mr. Besharat holds a BA (Economics) from McGill and an MSc. (Finance & Investment) from the University of Edinburgh.

Richard Meloff, JD, MBA - Mr. Meloff is a Managing Director at Oliver Capital Partners, a Canadian private equity and advisory firm. Oliver Capital has interests in real estate, communications and franchise systems. He serves on the Board at Boost Capital Corp. and Gideon Capital Corp. both of which have just announced significant resource acquisitions. Prior to joining Oliver, Richard was a Managing Director at Ubequity Capital Partners, a global merchant and investment bank. While at Ubequity, Richard led numerous acquisitions and financings in the technology and resource sectors. Richard has also served in various corporate development capacities at two large, publicly-traded companies and practiced corporate law in New York City, focusing on public M&A and complex strategic sourcing. Richard holds a BA from McGill University and a combined JD/MBA from the University of Toronto.

Conditions precedent to the closing of the Transaction include:

• Satisfactory completion of customary due diligence within 30 days of execution of the LOI.
• Entering into the Definitive Agreement.
• Pangea completing a financing of at least $5 million, the terms of which are to be determined.
• SG Spirit completing a consolidation of its outstanding common shares, warrants and options on the basis of one post-consolidation share for every four pre-consolidation shares.
• All necessary board, shareholder and regulatory approvals, including the approval of the Exchange, being received.

Sponsorship

The proposed Transaction is subject to the sponsorship requirements of the Exchange, unless an exemption from those requirements is granted by the Exchange. SG Spirit intends to apply for an exemption from the sponsorship requirements; however, there can be no assurance an exemption will be obtained. If an exemption from the sponsorship requirements is not obtained, a sponsor will be identified at a later date. An agreement to act as sponsor in respect of the Transaction should not be construed as any assurance with respect to the merits of the Transaction or the likelihood of its completion.

Completion of the Transaction is subject to a number of conditions, including Exchange acceptance and disinterested shareholder approval. The transaction cannot close until the required shareholder approval is obtained. There can be no assurance that the transaction will be completed as proposed or at all.

Investors are cautioned that, except as disclosed in the Management Information Circular to be prepared in connection with the Transaction, any information released or received with respect to the Transaction may not be accurate or complete and should not be relied upon. Trading in the securities of SG Spirit should be considered highly speculative.

The Exchange has in no way passed upon the merits of the proposed Transaction and has neither approved nor disapproved the contents of this press release.

About Pangea

Pangea Energy is a private Canadian-based oil and gas exploration and production company with interests in assets in Romania and is in negotiation to acquire producing and non-producing properties in the United States. Pangea is focused on increasing and optimizing production from oil producing assets, while also undertaking exploration programs on the core oil properties in its portfolio to identify targets and increase reserves.

ON BEHALF OF THE SG BOARD

Adrian Bray, President & CEO

Cautionary Note Regarding Forward-Looking Statements

Information set forth in this news release may involve forward-looking statements under applicable securities laws. Forward-looking statements are statements that relate to future, not past, events. In this context, forward-looking statements often address expected future business and financial performance, and often contain words such as "anticipate", "believe", "plan", "estimate", "expect", and "intend", statements that an action or event "may", "might", "could", "should", or "will" be taken or occur, or other similar expressions. All statements, other than statements of historical fact, included herein including, without limitation; statements about the terms and completion of the Transaction are forward-looking statements. By their nature, forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause our actual results, performance or achievements, or other future events, to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. Such factors include, among others, the following risks: the need for additional financing; operational risks associated with oil & gas exploration; requirement to obtain shareholder approval; failure to execute the Definitive Agreement, fluctuations in commodity prices; title matters; environmental liability claims and insurance; reliance on key personnel; the potential for conflicts of interest among certain officers, directors or promoters with certain other projects; competition; dilution; the volatility of our common share price and volume and the additional risks identified in the management discussion and analysis section of our interim and most recent annual financial statement or other reports and filings with the Exchange and applicable Canadian securities regulators. Forward-looking statements are made based on management's beliefs, estimates and opinions on the date that statements are made and SG Spirit Gold undertakes no obligation to update forward-looking statements if these beliefs, estimates and opinions or other circumstances should change, except as required by applicable securities laws. Investors are cautioned against attributing undue certainty to forward-looking statements.