UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM 10-Q

[ x ] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended March 31, 2014

[ ] TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT

For the transition period from _____________ to _____________

Commission File Number 333-129347

WHITE MOUNTAIN TITANIUM CORPORATION
(Name of small business issuer in its charter)

Augusto Leguia 100, Oficina 1401
Las Condes, Santiago
Chile
(Address of principal executive offices)

(56) 22 657-1800
(Issuer’s telephone number)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed under Section 13 or 15(d) of the Exchange Act during the past 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes [ x ] No [ ]

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes [ x ] No [ ]

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer”, “accelerated filer”, and “smaller reporting company” in Rule 12b-2 of the Exchange Act.

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes [ ] No [ x ]

79,585,392 shares of the issuer’s common stock, $.001 par value, were issued and outstanding at May 5, 2014.

TABLE OF CONTENTS

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PART I. FINANCIAL INFORMATION

See notes to the unaudited condensed consolidated financial statements.

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See notes to the unaudited condensed consolidated financial statements.

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See notes to the unaudited condensed consolidated financial statements.

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See notes to the unaudited condensed consolidated financial statements.

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During the year ended December 31, 2013, the Company acquired land to site the planned desalination plant at a cost of $76,770.

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Cerro Blanco

On September 5, 2003, the Company, through its wholly-owned Chilean subsidiary, White Mountain Chile, entered into a purchase agreement with Compañía Contractual Mineral Ojos del Salado (“Ojos del Salado”), a wholly-owned Chilean subsidiary of Phelps Dodge Corporation, to acquire a 100% interest in nine exploration mining concessions, collectively known as Cerro Blanco. Cerro Blanco is located in Region III of northern Chile, approximately 39 kilometres, or 24 miles, west of the city of Vallenar. Consideration for the purchase, including legal fees, was $651,950.

The purchase agreement covering Cerro Blanco was originally entered into between Ojos del Salado and Dorado Mineral Resources NL (“Dorado”) on March 17, 2000. Under that agreement, Dorado purchased the mining exploitation concessions from Ojos del Salado for $1,000,000, of which $350,000 was paid. A first mortgage and prohibitions against entering into other contracts regarding mining concessions without the prior written consent of Ojos del Salado had also been established in favor of Ojos del Salado. On September 5, 2003, White Mountain Chile assumed Dorado’s obligations under the purchase agreement, including the mortgage and prohibitions, with payment terms as described above.

La Martina

As a result of regional exploration carried out in January 2013, a new rutile prospect named La Martina has been discovered and staked in the Atacama, or Region III, geographic region of northern Chile. La Martina, which is located approximately 45 kilometres south-west of the city of Vallenar and 17 kilometres south-west of the Cerro Blanco project, consists of six registered exploration concessions. Concession fees and other costs incurred in staking the property have been expensed.

Ownership in mineral properties involves certain inherent risks due to the difficulties of determining the validity of certain claims as well as the potential for problems arising from the frequent, ambiguous conveyance history characteristic of mineral properties. The Company has investigated ownership of its mineral properties, and to the best of its knowledge, ownership of its interests is in good standing. At present, the Company has determined that it has no material asset retirement obligations.

Exploration expenditures incurred by the Company during the three months ended March 31, 2014 and 2013 were as follows:

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As at March 31, 2014 and December 31, 2013, the following stock options were outstanding:

The shares under option at March 31, 2014 had an exercise price of $1.30 (December 31, 2013: $1.30), an intrinsic value of $nil (December 31, 2013: $nil) and a weighted average remaining contractual life of 3.51 years (December 31, 2013: 3.75 years).

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These prices are subject to reasonable adjustment upon occurrence of certain conditions, as defined in the warrant indenture.

In March 2013, the Company issued warrants to purchase 2,152,216 shares of common stock, as part of a private placement offering. Each whole warrant is exercisable at $0.90 per share until July 25, 2014. In addition, 215,221 compensation warrants were issued to agents. The terms and conditions of the selling agent warrants are identical to the terms and conditions of the warrants sold to investors as part of the Units, except that the agent warrants had an original expiration date of March 12, 2015.

On September 5, 2013, the Board of Directors amended all outstanding warrants (except those held by a members of management) to extend the expiration date of the warrants to December 31, 2015. On October 7, 2013, the Board of Directors approved the re-pricing of the exercise price of all outstanding warrants, excluding any warrants held by management, to $0.65.

In December 2013, the Company issued warrants to purchase 5,714,286 shares of common stock, as part of a private placement offering (Note 6(c)). Each whole warrant is exercisable at $0.45 per share until December 31, 2016.

Details of stock purchase warrant activity for the year ended December 31, 2 013 and the period ended March 31, 2 014 are as follows:

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Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

Management’s Discussion and Analysis of Financial Condition and Results of Operations analyze the major elements of our balance sheets and statements of operations. This section should be read in conjunction with our Annual Report on Form 10-K for the year ended December 31, 2013, and our unaudited interim consolidated condensed financial statements for the three months ended March 31, 2014 and accompanying notes to these financial statements.

Forward Looking Statements

The statements contained in this report that are not historical facts are forward-looking statements that represent management’s beliefs and assumptions based on currently available information. Forward-looking statements include the information concerning our possible or assumed future results of operations, business strategies, need for financing, competitive position, potential growth opportunities, potential operating performance improvements, ability to retain and recruit personnel, the effects of competition and the effects of future legislation or regulations. Forward-looking statements include all statements that are not historical facts and can be identified by the use of forward-looking terminology such as the words “believes,” “intends,” “may,” “should,” “anticipates,” “expects,” “could,” “plans,” or comparable terminology or by discussions of strategy or trends. Although we believe that the expectations reflected in such forward-looking statements are reasonable, we cannot give any assurances that these expectations will prove to be correct. Such statements by their nature involve risks and uncertainties that could significantly affect expected results, and actual future results could differ materially from those described in such forward-looking statements.

Among the factors that could cause actual future results to differ materially are the risks and uncertainties discussed in this report. While it is not possible to identify all factors, we continue to face many risks and uncertainties including, but not limited to, the cyclicality of the titanium dioxide industry, global economic and political conditions, global productive capacity, customer inventory levels, changes in product pricing, changes in product costing, changes in foreign currency exchange rates, competitive technology positions and operating interruptions (including, but not limited to, labor disputes, leaks, fires, explosions, unscheduled downtime, transportation interruptions, war and terrorist activities). Mining operations are subject to a variety of existing laws and regulations relating to exploration and development, permitting procedures, safety precautions, property reclamation, employee health and safety, air and water quality standards, pollution and other environmental protection controls, all of which are subject to change and are becoming more stringent and costly to comply with. Should one or more of these risks materialize (or the consequences of such a development worsen), or should the underlying assumptions prove incorrect, actual results could differ materially from those expected. We disclaim any intention or obligation to update publicly or revise such statements whether as a result of new information, future events or otherwise.

There may also be other risks and uncertainties that we are unable to predict at this time or that we do not now expect to have a material adverse impact on our business.

Overview

We are a mineral exploration company engaged in the search for mineral deposits or reserves which could be economically and legally extracted or recovered. We hold mining concessions covering two rutile properties located in the Atacama region (Region III) of northern Chile, namely Cerro Blanco and the newly discovered La Martina.

We were incorporated in the State of Nevada on April 24, 1998. We have six wholly owned subsidiaries: SCM White Mountain Titanium, a Chilean stock company which holds our Chilean mining concessions for our Cerro Blanco project and conducts our principal exploration operations on that property; White Mountain Metals SpA, a Chilean stock company which holds the sublicense for the Chinuka process; White Mountain Titanium Corporation, a Canadian stock company which provides management and administrative services on behalf of the U.S. parent; White Mountain Minerals SpA, which holds our Chilean mining concessions for our La Martina project and conducts our principal exploration operations on that property; White Mountain Energy Ltda., an inactive Chilean company; and White Mountain Titanium (Hong Kong), a Hong Kong company which is inactive.

Our principal business is to explore for and develop natural rutile deposits on our mining concessions. Our principal objectives are to advance the Cerro Blanco project towards a final engineering feasibility, to secure off-take agreements for the planned rutile concentrate output, and to secure funding or other arrangements to place the project into production, if warranted. It would be the intention to sell the rutile concentrate to titanium metal and pigment producers. In addition, we

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continue to fund research and development on the Chinuka Process, which is conducting research into the recovery of feldspar and the production of refined titanium metal from materials sourced from these mining concessions. We also plan to expand our exploration activities on the La Martina concessions which we discovered in 2013.

Our common stock is currently traded in the over-the-counter market and is quoted on the OTCQB marketplace. Upon meeting listing requirements, it is our intention to graduate to a more senior exchange in due course.

We have produced no revenues, have experienced losses since inception, have no revenue producing operations, and currently rely upon the sale of our securities to fund our exploration activities on our mining properties.

Cerro Blanco

We are progressing in various stages of development on our Cerro Blanco project, which is our principal project. We have identified nine natural rutile prospects designated as the Las Carolinas, La Cantera, Eli, Chascones, Hororio’s Creek, Hippo Ear, Quartz Creek, Algodon and Bono prospects. The last five of these have only recently been located. We presently hold 44 registered mining exploitation concessions and 36 exploration concessions over an area of approximately 17,041 hectares.

La Martina

La Martina consists of 6 registered exploration concessions, covering an area of 1,288 hectares, comparable in size to the area covering the current nine known prospects at Cerro Blanco. Alteration and mineralization at La Martina is similar to that observed on the Cerro Blanco property.

Off-Take Agreements

We currently have two definitive off-take agreements in place:

• During 2011, we entered into our first off-take agreement with a major international pigment producer where that producer will purchase 25,000 tonnes per annum of our standard grade, natural rutile concentrate at US$1,200 per tonne FOB port. Deliveries must commence no later than September, 2014 and would run to December, 2016. The term of the agreement may then be extended by mutual agreement. If we are unable to provide product to the buyer before September 30, 2014, they will have the right to terminate this off-take agreement.

• On September 27, 2012, we entered into a second off-take agreement with a major international pigment producer for the supply of natural rutile concentrate from the Cerro Blanco project. Under the agreement, the pigment producer has agreed to purchase 10,000 tonnes per annum of our standard grade rutile concentrate at $1,250 per tonne FOB port. The three year term, which commences upon the production of 5,000 tons of product from the Cerro Blanco project, may be extended by mutual agreement. If we are unable to provide product to the buyer before December 30, 2014, they will have the right to terminate this off-take agreement.

The Chinuka Process

The Chinuka Process is a patented titanium metal technology developed by Chinuka Ltd. (“Chinuka”). We hold a sub-license to use Chinuka’s patented electro-refining process to produce titanium metal directly from a variety of titanium oxide concentrates and in this regard we have been funding research at the University of Cambridge since 2010 under the direction of Professor Derek Fray. To-date, Company-funded research on the Chinuka Process has focused principally on the production of titanium metal using natural rutile concentrate from the Cerro Blanco project as the process feedstock.

Major Developments

Since December 31, 2013, we had the following major developments:

• We issued 730,000 shares of common stock at a fair value of $306,600 to management, employees and consultants, under the 2010 Management Compensation Plan. Share certificates for 175,000 shares issued to our staff in Chile have been distributed, while the remaining share certificates for 555,000 shares issued to consultants and directors

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and officers have been withheld from distribution. The Board of Directors of the Company elected to place these shares under a voluntary escrow until the Company completes its Environmental Impact Statement.



• We entered into a financial advisory services agreement with RBC Capital Markets (the “Advisory Agreement”). The mandate will see both parties looking to enhance our presence in Asia and the PRC, as well as seeking to attract support for the Cerro Blanco Project from a strategic partner.

• We completed and filed with the Chilean environmental authority, Servicio de Evaluación Ambiental (“SEA”), a written response to a first round of questions posed to its EIS application under a public review. We expect to receive a written response from SEA by the end of May 2014.
   
  Subsequent to making the recent filing, Company management and its environmental personnel met with national and local government representatives from the Third Region to discuss outstanding issues related to the Cerro Blanco project (the “Project”). During the meeting, attendees from the national government and councilors representing local communities expressed strong support for the Project. Whilst the Company is not in a position to forecast when full EIS approval will be issued, continuing dialogue with and maintaining strong support from government and local communities remains a primary objective of our project personnel.

Results of Operations

We recorded a net loss of $1,414,403 for the three months ended March 31, 2014 ($0.02 per weighted average common share outstanding) compared to a net loss of $1,340,627 ($0.02 per share) for the comparative interim period in 2013.

A number of expenses in the three months ended March 31, 2014 were materially affected by the issuance of 730,000 shares of common stock during that period. These shares were issued to directors, officers, management, employees and consultants. As a result, a total of $306,600 was recognized as stock based compensation expense and allocated to Consulting fees, Consulting fees – directors and officers, Management fees and Office. No such share issuance was made in the prior year interim period. The fluctuations of these expenses are as follows:

• Consulting fees of $140,140 for 2014 as compared to $38,595 for 2013;
• Consulting fees – directors and officers: $281,830 for 2014 as compared to $101,541 for 2013;
• Management fees of $135,228 for 2014 as compared to $101,228 for 2013.

Research and development costs represent the amount of funding the Company has provided to further the Chinuka process. There was no amount committed and payable pertaining to the current period as a result of the expiration of the last annual funding agreement in December 2013. The renewal of the funding agreement is subject to further negotiation process. The $8,197 expense for the current period represented the difference between the amount accrued at December 31, 2013 and that actually paid subsequent to the year end.

Loss before other items for the current three-month period was $1,402,458, as compared to $1,309,154 for the comparative period in 2013.

Foreign exchange loss was $11,967 for the current period, as compared to $31,503 for the comparative period, due to the volatility of U.S. dollar compared to the Chilean Peso and Canadian dollar during the comparable period.

Liquidity and Cash Flows

As of March 31, 2014, we had a working capital of $716,181 (December 31, 2013: $1,692,148), including $826,216 (December 31, 2013: $2,056,996) of cash.

Cash used in operating activities was $1,228,924 for the three months ended March 31, 2014, compared to $1,069,278 for the comparable prior year period. Cash used in investing activities was $1,856 for the three months ended March 31, 2014 (2013: $1,195).

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We did not raise any cash from financing activities during the current three-month period. During the three months ended March 31, 2013, we raised a total of $2,762,751 in net cash through financing activities.

Subsequent to March 31, 2014, pursuant to a Binding MOU dated December 3, 2013 with the Investor, Million Cheer Investment Limited (“MCIL”), a company formed in Hong Kong, purchased 5,000,000 Second Tranche Units. The purchase price per unit for the Second Tranche Units was $0.40 per unit for gross proceeds of $2,000,000. The MOU provides for 7% selling commission in connection with the sale of the Second Tranche Units to non-U.S. purchasers.

We believe that the prospects are such that we will be able to raise sufficient funds. However, there are a number of risk factors which will influence our ability to do so, including the state of the capital markets generally, and the market price of our common stock. With the exception of funds on deposit and the expected remaining $6,000,000 from the sale of Second Tranche Units, we have no other sources of committed funds, except for outstanding warrants for which there are no commitments to exercise. The most likely source of new funds would be an equity placement of common shares or some form of strategic alliance. We believe that a failure to raise funds in a timely manner would likely delay the achievement of some of our project milestones, and would delay any decision regarding the viability of operations while likely increasing future costs.

Recent Accounting Pronouncements

In July 2013, the FASB issued ASU No. 2013-11, Income Taxes (Topic 740): Presentation of an Unrecognized Tax Benefit When a Net Operating Loss Carryforward, a Similar Tax Loss, or a Tax Credit Carryforward Exists (a consensus of the FASB Emerging Issues Task Force). US GAAP does not include explicit guidance on the financial statement presentation of an unrecognized tax benefit when a net operating loss carryforward, a similar tax loss, or a tax credit carryforward exists. The amendments in this ASU state that an unrecognized tax benefit, or a portion of an unrecognized tax benefit, should be presented in the financial statements as a reduction to a deferred tax asset for a net operating loss carryforward, a similar tax loss, or a tax credit carryforward, except as follows. To the extent a net operating loss carryforward, a similar tax loss, or a tax credit carryforward is not available at the reporting date under the tax law of the applicable jurisdiction to settle any additional income taxes that would result from the disallowance of a tax position or the tax law of the applicable jurisdiction does not require the entity to use, and the entity does not intend to use, the deferred tax asset for such purpose, the unrecognized tax benefit should be presented in the financial statements as a liability and should not be combined with deferred tax assets.

This ASU applies to all entities that have unrecognized tax benefits when a net operating loss carryforward, a similar tax loss, or a tax credit carryforward exists at the reporting date. The amendments in this ASU are effective for fiscal years, and interim periods within those years, beginning after December 15, 2013. The adoption of this ASU did not have a material impact on the Company’s consolidated financial statements or results of operations.

Item 3. Quantitative and Qualitative Disclosures About Market Risk

As a smaller reporting company, we have elected not to provide the disclosure required by this item.

Item 4. Controls and Procedures

Evaluation of disclosure controls and procedures

Our management, with the participation of our Principal Executive Officer and Chief Financial Officer, evaluated the effectiveness of our disclosure controls and procedures (as defined in Rule 15(d)-15(e) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”)) as of the end of the period covered by this report. Based on that evaluation, our Principal Executive Officer and Chief Financial Officer concluded that our disclosure controls and procedures as of the end of the period covered by this report were effective in ensuring that information required to be disclosed by us in reports that we file or submit under the Exchange Act (i) is recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission’s rules and forms, and (ii) is accumulated and communicated to the

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Company’s management, including its principal executive and principal financial officers, or persons performing similar functions, as appropriate to allow timely decisions regarding required disclosure.

Changes in internal control over financial reporting

There has been no change in our internal control over financial reporting, as defined in Rules 13a-15(f) of the Exchange Act, during our most recent fiscal quarter ended March 31, 2014, that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

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PART II. OTHER INFORMATION

Item 1A. Risk Factors

See “Item 1A – Risk Factors” as disclosed in Form 10-K as filed with the Securities and Exchange Commission on March 14, 2014.

Item 4. Mine Safety Disclosures

There are no reportable events required pursuant to this item.

Item 6. Exhibits

The following exhibits are furnished with this report:

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

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