NEWSNov 04, 2008 06:30 ET
VMS Enters Into a Letter of Intent for the Acquisition of Reed Lake Claims With W. Bruce Dunlop Ltd.
VANCOUVER, BRITISHCOLUMBIA--(Marketwire - Nov. 4, 2008) - VMS Ventures Inc. (TSXVENTURE:VMS) (the "Company") is pleased to announce that it has signeda Letter of Intent ("LOI") outlining terms and conditions to acquire a100% interest in the Dunlop Reed Lake Claims from W. Bruce Dunlop Ltd.(the "Vendor").
The Dunlop Reed Lake claims are currently subject to an OptionAgreement between the Company and the Vendor dated August 1, 2006 andamended November 1, 2007. The LOI has the following terms andconditions.
The Company shall:
(a) pay to the Vendor the sum of $375,000 on closing of the acquisition (the "Closing");
(b) issue to the Vendor 3,000,000 common shares of the Company, onClosing, it being acknowledged that such shares will be restricted fromtransfer for a period of four months in accordance with applicableregulatory requirements;
(c) agree to pay to the Vendor the further sum of $225,000, payableas to $125,000 on the first anniversary of the Closing and theremaining $100,000 on the second anniversary of the Closing. It isacknowledged that the obligation of the Company to make such paymentsis contingent upon the Company entering into an agreement, on or beforethe first anniversary date of the Closing, with a third party whichprovides for the commercial production of the Reed Lake Claims. For thepurpose of the LOI, that shall mean the production of ores,concentrates, metals or other mineral products for sale on a commercialbasis ("Commercial Production");
(d) agree to pay to the Vendor a production bonus of $600,000,payable to the Vendor in amounts equal to 20% of any payments receivedby the Company from Commercial Production, If and when such CommercialProduction occurs, concurrent with the receipt of such payments, untilthe full $600,000 has been paid.
Completion of the acquisition remains subject to execution of adefinitive agreement between the parties and the acceptance of the TSXVenture Exchange.
VMS Ventures CEO, Rick Mark, states: "We would like to thank theDunlop family for their efforts in this negotiation. We appreciatetheir support and are pleased that they are now significantshareholders in VMS. They have put their trust in us to build wealthfor them as shareholders through Reed Lake and the Discovery Zonedeposit and our entire VMS and Nickel property package in Manitoba."
VMS Ventures Inc. is focused primarily on acquiring, exploring anddeveloping copper-zinc properties in the Flin Flon-Snow Lake VMS Belt.The Company also holds the largest land package considered prospectivefor nickel-copper mineralization at Lynn Lake, which is to dateCanada's third largest nickel producing camp. The Company's projectportfolio consists of the Snow Lake VMS project, the Lynn Lake Gabbrosnickel-copper project, the Nickel Belt project, the South Baynickel-copper-cobalt PGE property, and the Eden Lake CarbonatiteComplex, Specialty Metals property. All VMS Ventures Inc. propertiesare located in the mining friendly province of Manitoba, Canada.
ON BEHALF OF THE BOARD OF DIRECTORS
John Roozendaal B.Sc., President & Director