KWG addresses notice of Superior Proposal respecting proposed combination of KWG and Spider

    Symbol on TSX Venture Exchange:   KWG
    Shares issued and outstanding:    589,549,206

MONTRÉAL, June 18 /CNW/ - KWG Resources Inc. ("KWG" or the "Company") has received notification from Spider Resources Inc (Spider) that Cliffs Natural Resources Inc (Cliffs) has made a Spider Alternative Proposal (as defined in the combination agreement among KWG, its wholly-owned subsidiary, 7569076 Canada Inc (KWG Subco) and Spider dated as of June 11, 2010 (the Combination Agreement), a copy of which is filed on Spider's SEDAR profile at www.sedar.com) and that the board of directors of Spider has determined such proposal to be a Spider Superior Proposal (as defined in the Combination Agreement). If the Spider Superior Proposal is proceeded with, Cliffs will increase the offer price under its take-over bid for the outstanding common shares of Spider and associated rights under Spider's shareholder rights plan (collectively the Spider Shares) to $0.165 per Spider Share.

Pursuant to the Combination Agreement, KWG has the opportunity, but not the obligation, to offer in writing to amend the terms of the Combination Agreement and the amalgamation of Spider and KWG Subco (the Amalgamation) before 12:01 a.m. on June 24th, 2010. KWG is considering making such an offer. If KWG makes an offer that matches the Spider Superior Proposal, KWG, KWG Subco and Spider will enter into an amended agreement reflecting KWG's amended proposal. If such an offer is not made by KWG or is made but not accepted by Spider as matching the Spider Superior Proposal, then as a condition to the right of Spider to terminate the Combination Agreement in order to enter into an agreement with respect to the Spider Superior Proposal or otherwise accept, approve or recommend the Spider Superior Proposal, Spider will be required, on or prior to the date of such termination, to pay to KWG a cash payment equal to $2,300,000.