Golden Valley Mines Ltd.

Golden Valley Mines Ltd.

January 05, 2007 17:29 ET

Golden Valley Mines Ltd.: Private Placement With Robert McEwen: $1,250,000

MONTREAL, QUEBEC--(CCNMatthews - Jan. 5, 2007) - Golden Valley Mines Ltd. (the "Company") (TSX VENTURE:GZZ) is pleased to announce a private placement of units ("Units") of the Company to Robert R. McEwen at a price of $0.33 per Unit for gross proceeds of $1,250,000. Each Unit shall be comprised of one common share and one warrant ("Warrant") of the Company. Each Warrant shall entitle Mr. McEwen to acquire one additional common share of the Company at an exercise price of $0.50 for a period of twenty four months after the date of issue of the Warrants. Upon completion of this financing, Mr. McEwen will exercise control or direction over approximately 7.8% of the outstanding common shares of the Company, making him the second largest shareholder of the Company. Assuming the exercise of all Warrants by Mr. McEwen, Mr. McEwen will exercise control or direction over approximately 14.6% of the outstanding common shares of the Company.

The closing of the financing is expected to occur on or about January 11, 2007. A finder's fee equal to 5% of the proceeds raised pursuant to the offering shall be paid in either cash or securities of the Company to an arm's length third party. All securities of the Company issued pursuant to the offering shall be subject to a hold period of four (4) months and one (1) day from the closing date of the offering. Completion of the transactions contemplated herein is subject to the approval of the board of directors of the Company, as well as to the approval of all the required regulatory authorities, including the TSX Venture Exchange. The funds raised pursuant to the private placement will be used by the Company to accelerate exploration, and for general corporate purposes.

About Golden Valley Mines Ltd.: The Company typically tests initial grassroots targets while owning a 100% interest in its properties and then seeks partners to continue exploration funding. This allows the Company to continue its generative programs and systematic exploration efforts at other majority owned grass-roots projects. As at the date hereof, the Company holds majority property interests in 131 projects consisting of 3,666 mining titles (203,805 hectares) in Ontario, Quebec, and Saskatchewan.

The TSX Venture Exchange has not reviewed and does not accept responsibility for the adequacy or accuracy of this release.

Contact Information