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Canada Business News and Press Releases
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(EMAILWIRE.COM, July 29, 2009 ) Vancouver, BC – ATW Gold Corp (ATW: TSX-V), ("ATW" or the "Company"), is pleased to announce it has reached an agreement with Red Kite Explorer Fund Limited ("Red Kite"), part of the Red Kite family of funds, pursuant to which Red Kite will extend ATW certain credit facilities and other financial instruments.
1. $40 Million Standby Credit Facility for Kinbauri Acquisition
Red Kite has agreed to provide ATW with a USD $40,000,000 standby credit facility (the "Kinbauri Facility"), on customary terms and conditions, subject to ATW completing the acquisition of Kinbauri of Kinbauri Gold Corp. as announced on July 14, 2009. The loan is subject to further customary due diligence to be performed by Red Kite, and ATW securing additional finance to advance the El Valle project through feasibility and mine commissioning.
The Kinbauri Facility is expected to be advanced under the following terms:
- A three year stand-by credit facility bearing 12% per annum;
- The credit facility will be secured by a first charge over all of the Kinbauri assets;
- ATW agrees to enter into a standard off-take agreement for the gold and copper produced from the El Valle asset.
2. $10 Million Credit Facility to Advance the Gullewa Gold Mine Project
In addition, Red Kite has agreed to provide a further USD $10,000,000 credit facility (the "Gullewa Facility") to advance ATW's Gullewa Gold Mine Project. The Gullewa Facility will bear interest at a 12% annual rate, amortizing monthly. It is likely that the funds from the Gullewa Facility will be used to finalize the scoping study and initiate plant refurbishment.
The Gullewa Facility is subject to a fixed and floating charge over all of the ATW assets (not including the Kinbauri assets should the proposed merger be successful), and to further customary due diligence to be performed by Red Kite.
3. Amendments to Existing Gold Loan Off-Take Agreement
Further to the Company's news release dated May 21, 2009, wherein the Company announced completion of a $10 million (USD) gold loan and concurrent production marketing agreement (the "Off-Take Agreement") with Red Kite, both Red Kite and the Company have agreed to amend the terms of the Off-Take Agreement such that the time to pay ATW for marketing its gold production from the Burnakura Mine (under the Off-Take Agreement between ATW and Red Kite) is immediately reduced to 15 days from 30 days.
The Company expects to complete formal agreements regarding the Off-Take Agreement, the Gullewa Facility and the Kinbauri Facility in the coming weeks.
Graham Harris, Chairman of ATW Gold Corp. commented, "Today's announcement further strengthens our financial resolve to develop our existing assets. Aligning with Red Kite , one of the world's largest metals-focused investment firms, helps ATW begin to secure the financing necessary to take El Valle through final feasibility and toward production."
"We urge the current shareholders of Kinbauri to support the plan of arrangement announced, so that they may benefit from the upside in growth and production profiles that a combined ATW Gold Corp and KInbauri Gold offers."
About Red Kite
Red Kite manages a diversified group of investment strategies specific to the non-ferrous and precious metals markets, in addition to the Red Kite Explorer mine financing fund. Red Kite's team of experienced professionals draw upon proprietary information flows sourced through the group's operation of a significant physical metals business. The firm operates across the global metals industry from offices in Bermuda, Hong Kong, London, New York, Shanghai and Sydney. In addition to the Red Kite Explorer Fund, Red Kite manages four other funds -- Red Kite Metals, Red Kite Compass, Red Kite Prospect 1 and Hong Feng Zheng -- which are predominantly trading focused and hold arbitrage, relative value, and directional positions. All of Red Kite's funds delivered positive returns in 2008.
About the Red Kite Explorer Fund
The Fund provides mining companies with project financing and metal offtake agreements, allowing them to initiate or expand mine production. All financing transactions include offtake, or forward-purchase, agreements enabling the Fund to purchase the individual mine's future metal production.
The amendments to the Off-Take Agreement and the granting of the Gullewa Facility and the Kinbauri Facility are all subject to the approval of the TSX-Venture Exchange as is the compensation payable to the Agent in connection therewith.
Casimir Capital LP, an investment banking firm in New York, acted as ATW's agent in respect of the Gullewa Facility and the Kinbauri Facility (the "Agent").
The Agent will receive a commission of 6% on the funds advanced under the Gullewa Facility and the Kinbauri Facility, paid in tranches as funds are received. In addition, the Agent will be issued 200,000 broker's warrants on the basis of 200,000 warrants for each USD $10,000,000 in credit drawn down. Each warrant exercisable for one common share of ATW for a period of two years at an exercise price of 125% of the market price of ATW's shares on the date prior to the entering into of formal agreements.
To find out more about ATW Gold Corp. please contact investor relations at 604-662-8184 or email investor@atwgold.com. You may also visit our website at www.atwgold.com.
ATW GOLD CORP.
"Graham Harris"
Chairman and Director
"Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release."
"This news release may contain forward–looking statements. Forward-looking statements address future events and conditions and therefore involve inherent risks and uncertainties. Actual results may differ materially from those currently anticipated in such statements."
ATW Gold Corp.
Brent Butle
604-662-8184
investor@atwgold.com 
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