Cap-Ex Ventures Ltd.
TSX VENTURE : CEV

Cap-Ex Ventures Ltd.

January 18, 2011 14:35 ET

Cap-Ex to Acquire Labrador/Quebec Iron Ore Properties, Concurrent Financing of $2,400,000, Appointment of Brett Matich to the Board of Directors

VANCOUVER, BRITISH COLUMBIA--(Marketwire - Jan. 18, 2011) - Cap-Ex Ventures Ltd. ("Cap-Ex" or the "Company") (TSX VENTURE:CEV) is pleased to announce it has entered into an agreement (the "Agreement") to acquire 100% of the interests in a group of Labrador / Quebec Iron Ore properties (the "Schefferville Properties", as described below) from Mandu Resources Ltd., Bedford Resources Partners Inc. and 743584 Ontario Inc. (the "Vendors").

The Schefferville Properties is comprised of Block 103, Block 44 and Lac Connelly covering a combined area of 9,050 hectares in the Labrador Trough.

The total consideration for the Schefferville Properties will be $275,000 and 5,000,000 common shares (the "Shares") of Cap-Ex. The parties have agreed that the Shares shall be subject to Tier II Value Escrow provisions. The Vendors will retain a 1.8% royalty on iron ore produced. Cap-ex will have the right to purchase 0.5% of the royalty for 1 million dollars for a period of 24 months from closing.

The Agreement calls for the Company and the Vendors to enter into formal agreements (the "Formal Agreements") on or before February 12, 2011.

The Agreement and the Formal Agreements are subject to their acceptance by the TSX-Venture Exchange.

THE LABRADOR / QUEBEC IRON ORE PROPERTIES

The Labrador / Quebec Iron Ore Properties (the "Schefferville Properties") consist primarily of interests in Newfoundland and Labrador License Numbers 014603M and 017736M together with Quebec Licenses CDC2133176, CDC2260945 and CDC2260957.

Block 103, which includes the Newfoundland and Labrador licences, consists of 94 continuous mineral claims covering 2,350 hectares, located within the Labrador trough 25 kilometres northwest of the mining town of Schefferville. Block 103's northern boundary neighbours the New Millennium Capital Corp. ("New Millennium") mineral claims, reported DSO current Resource of 44 million tones. Block 103's southern boundary neighbours Labrador Iron Mines Holdings Ltd. ("Labrador Iron") and New Millennium mineral claims contain the New Millennium and Labrador Iron DSO deposits. Labrador Iron plans to commence DSO production early this year and New Millennium is planning to produce 4 million tones DSO per annum. Block 103's west boundary is approximately 3 kilometres east of New Millennium's LabMag Resource of 5.7 billion tonnes at 29% iron. New Millennium plans to start development in 2012.

In June 2008, MPX Geophysics Ltd. undertook a heli-borne magnetic survey. Results from the 2008 survey showed Block 103 covers some of the most intense positive magnetic responses in the iron ore belt. These responses will be modeled to determine the depth, geometry and volume of the magnetite-bearing horizons, and estimate the concentrations. In addition, the area of low magnetic response will be analyzed to target horizons of DSO (hematite).

Block 44 which includes the Newfoundland and Labrador licenses, consists of 104 continuous mineral claims covering 2,600 hectares, located 15 kilometres south east of Schefferville. The claims cover both the east and west arms of a large interpreted magnetic anomaly. Historical reports by Iron Ore of Canada confirm the presence of iron ore.

Lac Connelly which includes three Quebec licenses, consists of 88 mineral claims covering 4,100 hectares, located approximately 200 kilometres north of Schefferville. An undrilled hematite horizon extending over 3,200 metres and up to 300 metres wide grading 45 to 60% iron was reported in 1955 (ref Natural Resource Department GM03035).

CONCURRENT FINANCING OF $2,400,000

The Company wishes to announce that it will, concurrently with acquiring an interest in the Schefferville Properties, arrange a non-brokered private placement (the "Private Placement").

The Private Placement is to consist of:

  1. Up to 6,000,000 non flow-through units of the Company (the "Units") at a price of $0.30 per unit with each unit comprised of one common share and one half of one common share purchase warrant (a "Warrant). Each such Warrant will entitle the holder to purchase one common share of the Company for a period of 18 months from the closing date at a price of$0.60 per common share.
  2. 1,500,000 flow-through units of the Company (the "FT Units") at a price of $0.40 per FT unit with each FT unit comprised of one common share and one half of one common share purchase warrant (a "Warrant"). Each such Warrant will entitle the holder to purchase one common share of the Company for a period of 18 months from the closing date at a price of $0.60 per common share.

The Company has agreed to allocate a portion of the offering to subscribers found by Axemen Resources Capital Ltd., an Exempt Market Dealer, and may agree to similar allocations to other exempt market or investment dealers. The Company will pay a finder's fee equal to 5% of subscription amounts found, payable in cash or Units, plus issue finder's warrants in an amount equal to 5% of Units subscribed for, with each finders warrant exercisable into one common share of the Company at a price of CDN $0.35 for 18 months from closing.

The majority of the Private Placement will be used to fund expenditures on the Company's Schefferville Properties with the remainder for general working capital.

APPOINTMENT OF BRETT MATICH TO THE BOARD OF DIRECTORS

As a condition of the Agreement concerning the Schefferville Properties described above, the Company is appointing Mr. Brett Matich to its Board of Directors. The appointment is expected to be made effective the date of the Formal Agreements' execution.

Mr. Brett Matich is an Australian who recently became a permanent resident of Canada. He has been involved in the mining industry in Australia and around the world for 30 years. Mr. Matich was the Managing/Executive Director of ASX listed and AIM listed Aztec Resources Ltd ("Aztec") where he identified an Australian dormant iron ore mine, and successfully completed a bankable feasibility study. Aztec was takeover by ASX listed Mount Gibson Iron Ltd in 2006 and now the Aztec mine exports approximately 3 million tonnes of iron ore per annum. As inaugural Managing Director of ASX listed Fox Resources Ltd. ("Fox") in 2002, Mr. Matich identified a closed Australian nickel mine and successfully returned it to production by 2004. He has been involved in excess of $100M in financings from Australian, European and Asian institutions, and sophisticated investors.

CAP-EX VENTURES LTD.

Andrew Bowering, President and CEO

"This news release may contain forward–looking statements. Forward-looking statements address future events and conditions and therefore involve inherent risks and uncertainties. Actual results may differ materially from those currently anticipated in such statements."

"Neither the 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."

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