/NOT FOR DISTRIBUTION TO UNITED STATES NEWSWIRE SERVICES OR FOR
DISSEMINATION IN THE UNITED STATES./
TORONTO, Aug. 28 /CNW/ - Unigold Inc. ("Unigold" or the "Company") (TSX-V: UGD). With recent disruptions in global credit markets affecting numerous US and Canadian banks, mutual funds, institutional and private investors and large and junior public companies, Unigold wishes to advise shareholders of the status of its cash investments of approximately CAD$10 million and US$1 million. In accordance with its investment policy, and based upon professional advice, the Company invested in products ranked by Dominion Bond Rating Service ("DBRS") as R-1-High. Between August 13 and 15, 2007, various participants in the asset-backed commercial paper ("ABCP") market announced that they were experiencing market disruption and as a result were unable to meet their repayment obligations until their liquidity providers fund such repayment.
A note held by the Company which was due and payable for CAD$10 million remains outstanding as a result of the inability to complete a rollover on the due date because of lack of (temporary) liquidity for asset-based notes.
The Company currently has sufficient cash on hand to fund ongoing operations assuming that this market disruption is settled in a timely manner. In the interim, the Company has received a confirmation from its bank that it has approved a CAD$4,000,000 demand loan that will be backed by the ABCP to assist the Company with its working capital requirements.
"This credit facility provides us with sufficient cash to continue to operate while the longer-term liquidity issue is being resolved in the marketplace," said Dr. Talal Al-Shair, Chairman of the Board of Unigold. Dr. Al-Shair further stated that Shairco for Trading, Industry & Contracting Co. Ltd., Unigold's major shareholder, will also offer a credit facility to draw on should such a need arise. "With the very encouraging results of the exploration program on Unigold's property in the Dominican Republic, Unigold must be in a position to actively pursue its current exploration program."
About Unigold Inc.
------------------
Unigold Inc. is exploring to find and develop gold deposits on its 100-per-cent-owned 226 km(2) Neita property located in the Dominican Republic. Having the largest land package in the Dominican Republic, the goal is to target bulk tonnage, open pittable, oxide gold deposits within a similar setting to the world class Pueblo Viejo gold project which occurs within a broad northwest trending Cretaceous age volcanic greenstone belt that transects the Dominican Republic. The economics of any discovery will be significantly improved by the fact that Unigold is benefiting from an 18-year holiday on all corporate taxes, sales taxes and import duties in the Dominican Republic.
The TSX Venture Exchange has not reviewed and does not accept
responsibility for the adequacy or accuracy of this press release.
Certain statements contained in this document, including statements regarding events and financial trends that may affect our future operating results, financial position and cash flows, may constitute forward-looking statements within the meaning of the federal securities laws. These statements are based on our assumptions and estimates and are subject to risk and uncertainties. You can identify these forward-looking statements by the use of words like "strategy", "expects", "plans", "believes", "will", "estimates", "intends", "projects", "goals", "targets", and other words of similar meaning. You can also identify them by the fact that they do not relate strictly to historical or current facts. We wish to caution you that such statements contained are just predictions or opinions and that actual events or results may differ materially. The forward-looking statements contained in this document are made as of the date hereof and we assume no obligation to update the forward-looking statements, or to update the reasons why actual results could differ materially from those projected in the forward-looking statements. Where applicable, we claim the protection of the safe harbour for forward-looking statements provided by the (United States) Private Securities Litigation Reform Act of 1995.
%SEDAR: 00004036E