Venture One Capital Corp.

July 16, 2009 18:39 ET

Venture One Capital Corp. Announces Definitive Agreement to Acquire NMC, Inc. and Brokered Short Form Offering

WEST VANCOUVER, BRITISH COLUMBIA--(Marketwire - July 16, 2009) - Venture One Capital Corp. ("Venture One" or the "Corporation") (TSX VENTURE:VO.P) is pleased to announce that further to its news release dated June 22, 2009, it has entered into a definitive agreement ("Definitive Agreement") with NMC, Inc. ("NMC") and the three (3) shareholders of NMC, whereunder it is anticipated that the Corporation will acquire all of the issued and outstanding shares of NMC, the owner and operator of certain mineral exploration properties (the "Properties") located in the Republic of Korea ("South Korea"), (the "Acquisition").

The Corporation is a capital pool company and intends for the Acquisition to constitute the "Qualifying Transaction" of the Corporation as such term is defined in the policies of the TSX Venture Exchange (the "Exchange"). The Acquisition is an arm's length transaction and upon completion thereof, it is expected that the Corporation will be a Tier 2 Mining Issuer.

NMC is a private corporation existing under the laws of South Korea, and is owned as to: (i) 72.5% by Dong Won Corporation ("Dong Won"), a corporation existing under the laws of South Korea (ii) 25% by KTB 2007 Private Equity Fund ("KTB"), a fund existing under the laws of South Korea; and (iii) 2.5% by Myventure Partners ("Myventure"), a legally registered venture capital organization registered with the South Korea Ministry of Knowledge and Economy (hereinafter, Dong Won, KTB and Myventure shall be collectively known as the "Vendors"). NMC and the Vendors' head offices are all located in South Korea.

Highlights of the Acquisition

Pursuant to the terms of the Definitive Agreement, subject to the satisfaction of certain closing conditions customary to transactions of the nature of the Acquisition and receipt of applicable regulatory approvals, the Corporation intends to acquire from the Vendors all of the issued and outstanding shares of NMC. As consideration for the Acquisition, it is expected that the Corporation will issue to the Vendors a combination of common shares and exchangeable shares convertible into common shares of the Corporation representing on a fully diluted basis a total of 200,000,000 common shares in the capital of the Corporation (the "Acquisition Shares"). The Acquisition Shares will be issued at a deemed price of CAD$0.10 per share representing a deemed Acquisition value of CAD$20,000,000. The Acquisition Shares will be subject to the escrow requirements of the Exchange, if applicable.

Pursuant to the Definitive Agreement, Venture One has agreed to cause the directors and officers of Venture One to terminate their respective agreements for the exercise of options to purchase common shares, and in consideration of doing so, the directors and officers of Venture One, or their nominees, shall be entitled to participate for up to 15% of the Offering (as defined below).

The Property

On April 1, 2008, NMC was established from the spin-off of the molybdenum mine business segment of Dong Won. Assets and liabilities were transferred from Dong Won to NMC at their carrying amounts.

The Acquisition will give the Corporation a 100% interest (which NMC holds) in the former Keumseong Molybdenum Mine (located southeast of Seoul, South Korea) which Dong Won acquired in 2004. The NMC Moland Molybdenum Property is comprised of three mining leases obtained in 2004 and 2005 for a 20 year term. NMC is currently constructing a new mill facility located at the mine site in Jechoen, South Korea.

The Corporation is currently in the process of obtaining a National Instrument 43-101 compliant report in respect of the Properties which is expected to be available within the next thirty days.

Officers and Directors of the Resulting Issuer

In connection with the completion of the Acquisition, it is intended that all of the current directors and officers of the Corporation will resign and be replaced with nominees of NMC, although at this point in time it has not been determined who will be appointed as officers or directors of the Corporation following completion of the Acquisition.

Escrow Transfer

The Definitive Agreement provides that certain shareholders of Venture One who hold their common shares in escrow have agreed to sell, assign and transfer within escrow not less than 2,300,000 of the common shares held in escrow ("Escrow Shares"), to one or more nominees of NMC (who will be a Principal or Principals, as defined in the policies of the Exchange, of Venture One following the Acquisition) concurrently with the closing of the Acquisition, at a purchase price equal to the original issuance price of the Escrow Shares, being $0.075 per Escrow Share.

Brokered TSX Venture Exchange Short Form Offering

The Corporation has also entered into an engagement agreement with Bolder Investment Partners, Ltd. of Vancouver, British Columbia, (the "Agent") contemplating the engagement of the Agent to act as agent for a TSX Venture Exchange short form offering of common shares of the Corporation in the Provinces of British Columbia and Alberta in accordance with the policies of the TSX Venture Exchange Inc. (the "Offering"). The Offering will be for such number of common shares to be issued from the Corporation's treasury, at a price per share to be determined in accordance with the policies of the TSX Venture Exchange Inc. (the "Exchange") and further subject to such mutual agreement between the Corporation and the Agent, necessary to raise gross proceeds of up to one million five hundred ($1,500,000) dollars, with an option to increase the Offering by an amount of up to $500,000 in the event of over subscription.

Among other things, the completion of the Offering will be conditional upon the Offering being accepted for filing by the Exchange, compliance with applicable corporate and securities laws, the Offering being acceptable to investors, no adverse material changes occurring in respect of the Corporation's business and affairs prior to the closing of the Offering and upon or will occur concurrent with closing of the Acquisition. In consideration of completing the Offering the Corporation has agreed to pay to the Agent as follows:

a) A commission equal to eight (8%) percent of the gross proceeds of the Offering of which the Agent may elect to be paid in common shares;

b) A non-refundable work fee of fifteen thousand ($15, 000) dollars plus G.S.T.;

c) A corporate finance fee of ten thousand ($10,000) dollars plus G.S.T.; and

d) Warrants (the "Agent's Warrants") with a term of twenty four (24) months from the completion of the Offering entitling the Agent to purchase up to such number of common shares of the Corporation equal to ten (10%) percent of the total number of shares sold through the Offering exercisable at a price of $0.15.

The net proceeds of the Offering will be used by the Corporation to finance the development work on the Properties, for general working capital purposes of the Corporation, and to pay closing costs associated with the Offering.

Sponsorship of Qualifying Transaction

In view of the Offering, it is anticipated that the Corporation will qualify for an exemption from the Exchange requirements for sponsorship.

Summary Financial Information

Financial statements as required by the Exchange, were not available at the time of this press release. However, the Corporation will in due course make available to the Exchange, all financial information as required by the Exchange and will provide, if required by the Exchange, in a press release to be disseminated at a later date, summary financial information derived from such statements.

Finder's Fee

Subject to the approval of the Exchange, the Definitive Agreement contemplates that at the closing of the Acquisition a finder's fee in connection with the Acquisition in the aggregate amount of 2,300,000 Common Shares will be issued to certain individuals.

Conditions of the Acquisition

Completion of the Acquisition is subject to a number of conditions including, but not limited to, the closing of the Offering, closing conditions customary to transactions of the nature of the Acquisition, Exchange acceptance and, if required by Exchange policies, majority of the minority shareholder approval. Where applicable, the Acquisition cannot close until the required shareholder approval is obtained and there can be no assurance that the Acquisition will be completed as proposed or at all.

Investors are cautioned that, except as disclosed in the management information circular or filing statement to be prepared in connection with the Acquisition, any information released or received with respect to the Acquisition may not be accurate or complete and should not be relied upon. Trading in the securities of a capital pool company should be considered highly speculative.

The Corporation's common shares are currently listed for trading on the Exchange. In accordance with Exchange policy, however, the Corporation's shares are currently halted from trading and will remain halted until such time as determined by the Exchange, which, depending on the policies of the Exchange, may not occur until the completion of the Acquisition.

Cautionary Statements

Certain statements contained in this release constitute forward-looking information. These statements relate to future events or future performance. The use of any of the words "could", "intend", "expect", "believe", "will", "projected", "estimated" and similar expressions and statements relating to matters that are not historical facts are intended to identify forward-looking information and are based on the Corporation's current belief or assumptions as to the outcome and timing of such future events. Actual future results may differ materially. In particular, this release contains forward-looking information relating to: the terms and conditions of the Acquisition, including securities of Venture One to be issued and transferred pursuant thereto and the completion of all matters contemplated by the Definitive Agreement, the board and officer composition of Venture One following the Acquisition; matters related to the Offering and transfer within escrow; and obtaining a Report within the next thirty days. Various assumptions or factors are typically applied in drawing conclusions or making the forecasts or projections set out in forward-looking information. Those assumptions and factors are based on information currently available to Venture One. The material factors and assumptions include: the parties to the Acquisition being able to obtain the necessary director, shareholder and regulatory approvals; Exchange policies not changing; completion of satisfactory due diligence; the structure of the Acquisition being the most tax efficient way of completing the Acquisition; no unforeseen circumstances with respect to the preparation of the Report that would slow down its completion. Risk Factors that could cause actual results or outcomes to differ materially from the results expressed or implied by forward-looking information include, among other things: conditions imposed by the Exchange, the failure to obtain the required directors' and shareholders' approval to the Acquisition; changes in tax laws, general economic and business conditions; the inability to complete the Offering and changes in the regulatory regulation. Venture One cautions the reader that the above list of risk factors is not exhaustive. The forward-looking information contained in this release is made as of the date hereof and Venture One is not obligated to update or revise any forward-looking information, whether as a result of new information, future events or otherwise, except as required by applicable securities laws. Because of the risks, uncertainties and assumptions contained herein, investors should not place undue reliance on forward-looking information. The foregoing statements expressly qualify any forward-looking information contained herein.

Neither 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.

Contact Information

  • Venture One Capital Corp.
    Daniel B. Evans
    President, Chief Executive Officer and Director
    (604) 922-2030