Mr. Bob Garnett of Great Panther reports

CANGOLD TO BE ACQUIRED BY GREAT PANTHER SILVER

Great Panther Silver Ltd. and Cangold Ltd. have entered into a binding letter agreement dated Feb. 25, 2015, pursuant to which Great Panther will, subject to the terms and conditions of the letter agreement, acquire all of the issued and outstanding common shares of Cangold by way of a statutory plan of arrangement. This transaction will result in Great Panther adding the option to acquire more than 6,000 hectares of the Guadalupe de los Reyes gold-silver project in Sinaloa state, Mexico (GDLR), to its existing silver-gold-producing properties in Mexico at Guanajuato and Topia. The transaction also adds Cangold's Plomo gold project in Mexico and its Argosy project in the Red Lake mining division of Northeastern Ontario, Canada.

Under the terms of the arrangement, Cangold shareholders will receive 0.05 common share of Great Panther for each common share of Cangold resulting in the issuance of approximately 2,139,000 Great Panther shares in exchange for 42,780,600 Cangold shares. The shares of Great Panther to be issued represent approximately 3 per cent of its current issued and outstanding shares. Total share consideration is valued at approximately $1.7-million.

R.W. (Bob) Garnett, chairman of Great Panther, stated: "Guadalupe de los Reyes is a strong fit with Great Panther's current producing mines and projects in Mexico. Our team has proven success in developing producing mines in Mexico, and has the expertise and resources to advance Guadalupe de los Reyes. The proposed acquisition will also realize cost synergies in terms of management, administration and overhead."

Kaare G. Foy, executive chairman of Cangold, stated: "Through this proposed acquisition, Cangold shareholders not only maintain their exposure to the success of Guadalupe de los Reyes, but now also have exposure to the growth of a producing company that is leveraged to the price of silver and gold. Great Panther is an experienced operator in Mexico with a strong balance sheet, no debt and has access to capital to advance Guadalupe de los Reyes. In addition, Great Panther has a highly liquid stock and is listed on two major exchanges. Cangold's management strongly recommends shareholder approval of the proposed transaction."

Terms of the arrangement

Pursuant to the letter agreement:

• Cangold shareholders will receive 0.05 Great Panther share for each Cangold share held. Upon completion of the transaction, Cangold shareholders will own approximately 2,139,030 Great Panther shares, or approximately 3 per cent of the resulting 141,680,070 Great Panther shares outstanding.
• Each outstanding option and warrant to acquire Cangold shares will entitle the holder thereof to receive, upon the exercise thereof, 0.05 Great Panther share in lieu of each Cangold share, at a price adjusted in accordance with the exchange ratio, and otherwise on the same terms and conditions as the original option or warrant.
• Completion of the transaction is subject to customary conditions, including support of the transaction by directors, officers and significant shareholders of Cangold, and receipt of applicable regulatory, shareholder and third party approvals, and consents by Cangold and Great Panther, as may be required to effect and complete the transaction. Completion of the transaction is also subject to Great Panther being satisfied with the results of its due diligence investigations, receipt by Great Panther of an opinion of Mexican legal counsel relating to the option Cangold holds in respect of the GDLR project in Sinaloa, Mexico.
• Great Panther and Cangold have agreed to negotiate in good faith and enter into a definitive agreement relating to the arrangement incorporating the terms of the letter agreement together with additional representations, warranties, covenants, conditions and agreements as are customary for a transaction of this nature on or before April 25, 2015, or such later date as the parties mutually agree.
• Cangold has agreed to an exclusivity period until April 25, 2015, during which time Cangold will work exclusively and in good faith with Great Panther toward the satisfactory completion of confirmatory due diligence and negotiation of the definitive agreement. During the exclusivity period, Cangold will not, among other things, solicit, initiate, facilitate, continue, respond to or encourage any third party proposal in respect of an alternative transaction. Cangold is obligated to pay Great Panther a termination fee should Cangold terminate the exclusivity period in certain circumstances or in the event that Great Panther terminates the letter agreement due to a breach of certain representations and warranties.
• Concurrent with the execution of the letter agreement, Great Panther, Cangold and a Mexican subsidiary of Cangold entered into a suite of loan documents pursuant to which Great Panther has agreed to continue to provide technical, administrative and management services to Cangold; and to provide discretionary credit advances, in the maximum aggregate amount of up to $1.5-million, inclusive of a prior debt already owing from Cangold to Great Panther in the approximate amount of $155,000. Pursuant to the loan principal owing thereunder will bear interest at the rate of 15 per cent, will be secured by a general security agreement and share pledge agreement, and, subject to regulatory approval, Great Panther will be entitled to bonus common shares in the capital of Cangold in the amount of 20 per cent of the prior debt divided by the market price (as such term is defined in TSX Venture Exchange policies) and a further 20 per cent of the value of any advance, divided by the market price.

Great Panther currently has three directors and/or officers that are also directors and/or officers of Cangold, including the same president and chief executive officer, rendering such directors and officers related parties for purposes of Multilateral Instrument 61-101. Great Panther will issue a material change report containing the required information in compliance with MI 61-101 with respect to this transaction. Great Panther is relying on exemptions from formal valuation (Subsection 5.5(a) of MI 61-101) and the minority shareholder approval requirements (Subsection 5.7(1)(a) of MI 61-101) because at the time of the transaction under the letter agreement neither the fair market value of the subject matter nor the fair market value of the consideration to be paid to the related parties exceed 25 per cent of Great Panther's market capitalization.

The letter agreement and the loan were reviewed and approved by special committees consisting of independent directors of both Great Panther and Cangold. Cangold will hold a shareholder meeting to consider and approve the arrangement no later than May 12, 2015, and such shareholders meeting will require approval of the majority of the minority of Cangold's shareholders. The terms of the arrangement will be described in further detail in the management information circular of Cangold to be filed with regulatory authorities and mailed to Cangold shareholders in accordance with applicable securities laws.

Cangold securityholders and other interested parties are advised to read the materials relating to the proposed arrangement, including the letter agreement, that will be filed by Cangold with securities regulatory authorities in Canada when they become available. Anyone may obtain copies of these documents when available free of charge at SEDAR. The arrangement is subject to approval of the Toronto Stock Exchange and applicable filings with the New York Stock Exchange (in respect of Great Panther) and the TSX Venture Exchange (in respect of Cangold).

Assuming that all requisite approvals are received, the parties expect to close the proposed acquisition prior to the end of May, 2015.

We seek Safe Harbor.