Creston Moly Corp.

Creston Moly Corp.

July 17, 2009 12:05 ET

Creston Moly Corp.: Response to Application for OSC Hearing

VANCOUVER, BRITISH COLUMBIA--(Marketwire - July 17, 2009) - Creston Moly Corp. ("Creston" or the "Company") (TSX VENTURE:CMS) announces that legal counsel for a group of four shareholders of Creston (the "Group") has sent a letter (the "Letter") to the Ontario Securities Commission ("OSC") requesting a hearing to consider and to grant various orders, including an order to set aside the decision of the TSX Venture Exchange ("TSXV") approving a private placement (announced by Creston on July 2, 2009), and an order to require shareholder approval for the private placement.

Management of Creston have reviewed the Letter and are concerned that factual inaccuracies and omissions of material information convey a misleading impression with respect to the actions of the Company. Creston shall vigorously oppose the orders requested by the Letter at any hearing in relation to this matter, however a date for any such hearing has not been fixed.

The following is a summary of the events giving rise to the Letter. On May 27, 2009, Creston announced a proposed business combination with Tenajon Resources Corp. ("Tenajon"). Members of the Group expressed concerns with respect to the proposed Tenajon transaction, and representatives of the Company met with members of the Group to hear their concerns and to explain the business rationale for the transaction.

On June 19, 2009, the Group sent a formal requisition of a meeting of the shareholders for the purpose of: (i) passing of a special resolution to terminate the proposed Tenajon transaction; (ii) to remove the current directors; and (iii) to elect new directors of the Company. This requisition was invalid due to the fact that none of the members of the Group were registered shareholders of the Company. Despite this fact, Creston management were giving serious consideration to convening a shareholder meeting to consider the proposed Tenajon transaction, despite the fact that the TSXV had confirmed that shareholder approval was not required.

On July 3, 2009, a second formal requisition was received, the substance of which was the same as the first, however certain members of the Group were now registered shareholders of the Company. Management promptly disclosed, in a news release issued July 8, 2009, that Creston had received a requisition and would convene a shareholder meeting (the "Meeting") to consider the proposed Tenajon transaction. Creston has complied, and will continue to comply, with the provisions of the Business Corporations Act (British Columbia) with respect to the requisition for the Meeting. Management are working with Tenajon to coordinate the dates of their respective meetings, which will be announced shortly.

On July 2, 2009, the Company announced a non-brokered private placement consisting of 30,000,000 units at a price of $0.10 per unit, the net proceeds of which will be used for working capital purposes. The Company currently has a working capital deficit of in excess of $2,500,000, which includes $4,140,000 for an arbitration award with respect to a finder's fee dispute. The Company has applied to the British Columbia Supreme Court for leave to appeal the arbitration award, and the decision is pending. Management are optimistic that the leave will be granted, however Creston must be prepared for the possibility that the leave application will be unsuccessful. In addition, the Company must also be in a position to pay a $350,000 break fee to Tenajon should a special resolution to terminate the proposed Tenajon transaction be passed at the Meeting. In light of these very significant potential obligations and other trade payables, it is imperative that the Company complete the private placement without delay.

The proposed business combination with Tenajon and the private placement are completely unrelated transactions which are being undertaken in full compliance with the policies of the TSXV. Creston's Board and management are unanimous in their support that: (i) the private placement is essential to maintain the operations of the Company: and (ii) the proposed Tenajon transaction is in the best interests of the shareholders. We look forward to receiving support for the proposed Tenajon transaction at the Meeting.

About Creston

Creston owns 100% of the Creston Molybdenum Deposit (Creston Project) located in Sonora, Mexico. An independent Pre-Feasibility Study, prepared by M3 Engineering & Technology Corporation of Tucson, Arizona ("M3"), estimated production, capital and operating cost parameters along with project economics, and considers both owner and contract mining scenarios.

On behalf of The Board

Jonathan W. George, President & CEO

Forward-Looking Statements

This document may contain "forward-looking statements" within the meaning of Canadian securities legislation and the United States Private Securities Litigation Reform Act of 1995. These forward-looking statements are made as of the date of this document and Creston does not intend, and does not assume any obligation, to update these forward-looking statements.

Forward-looking statements relate to future events or future performance and reflect Creston management's expectations or beliefs regarding future events and include, but are not limited to, statements with respect completion of the private placement and related matters. In certain cases, forward-looking statements can be identified by the use of words such as "plans", "expects" or "does not expect", "is expected", "budget", "scheduled", "estimates", "forecasts", "intends", "anticipates" or "does not anticipate", or "believes", or variations of such words and phrases or statements that certain actions, events or results "may", "could", "would", "might" or "will be taken", "occur" or "be achieved" or the negative of these terms or comparable terminology. By their very nature forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of Creston to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements. Such factors include, among others, risks related to actual results of current exploration activities; changes in project parameters as plans continue to be refined; future prices of resources; possible variations in ore reserves, grade or recovery rates; accidents, labour disputes and other risks of the mining industry; delays in obtaining governmental approvals or financing or in the completion of development or construction activities; as well as those factors detailed from time to time in Creston's interim and annual financial statements and management's discussion and analysis of those statements, all of which are filed and available for review on SEDAR at Although Creston has attempted to identify important factors that could cause actual actions, events or results to differ materially from those described in forward-looking statements, there may be other factors that cause actions, events or results not to be as anticipated, estimated or intended. There can be no assurance that forward-looking statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements.

Accordingly, readers should not place undue reliance on forward looking 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.

Contact Information