Venerable Ventures Ltd.
TSX VENTURE : VLV.P

December 14, 2010 16:30 ET

Venerable Ventures Ltd. Announces Qualifying Transaction

VANCOUVER, BRITISH COLUMBIA--(Marketwire - Dec. 14, 2010) - Venerable Ventures Ltd. (TSX VENTURE:VLV.P) ("Venerable") is pleased to announce that it has entered into a binding letter of intent dated December 10, 2010 (the "LOI") with Robert Gordon Carmichael and Landmark Geological Inc. (together, the "Optionors"), whereby Venerable can acquire up to 100% of the Optionors' 100% interest in and to nineteen mineral claim blocks known as the Trout Claims (collectively, the "Property"), located in the Nechako Plateau, near Vanderhoof, British Columbia (the "Transaction").

The Transaction is intended to be Venerable's "qualifying transaction" as that term is defined in Policy 2.4 of the TSX Venture Exchange (the "Exchange") concerning capital pool companies. To date, Venerable has been a capital pool company with the business of indentifying a qualifying transaction.

The Transaction will be carried out by parties dealing at arm's length to one another and no non-arm's length parties of Venerable have any direct or indirect interest in the Property, therefore the Transaction will not be a Non-Arm's Length Qualifying Transaction as such term is defined in Exchange Policy 2.4. Venerable does not expect that approval of its shareholders will be required for the Transaction.

Upon completion of the Transaction, Venerable expects that it will be classified as a mining issuer under the policies of the Exchange and will be engaged in the exploration and development of prospective mineral properties, including the Property.

Terms of the Transaction

Under the terms of the LOI, the Optionors have agreed to grant Venerable an option (the "Option") to acquire up to 100% of their right, title and interest in and to the Property. In order to exercise the Option, Venerable will be required to:

  1. pay to the Optionors an aggregate of $435,000 as follows:
    1. $25,000 within five (5) days of the execution of the LOI,
    2. $105,000 on the date of the final acceptance of the Qualifying Transaction by the Exchange (the "Acceptance Date"),
    3. $50,000 on or before the first anniversary of the Acceptance Date,
    4. $75,000 on or before the second anniversary of the Acceptance Date, and
    5. $180,000 on or before the third anniversary of the Acceptance Date;
  2. incur exploration expenditures of $1,500,000 on the Property as follows:
    1. $200,000 on or before the first anniversary of the Acceptance Date,
    2. $500,000 on or before the second anniversary of the Acceptance Date, and
    3. $800,000 on or before the third anniversary of the Acceptance Date; and
  3. allot and issue to the Optionors, as fully paid and non-assessable, an aggregate of:
    1. 300,000 common shares of Venerable (each, a "Share") on the Acceptance Date;
    2. 100,000 Shares on or before the first anniversary of the Acceptance Date,
    3. 200,000 Shares on or before the second anniversary of the Acceptance Date, and
    4. 400,000 Shares on or before the third anniversary of the Acceptance Date.

The Company intends to use its working capital to make the cash payments required under the LOI.

Venerable will have the exclusive right to manage and operate all work programs carried out on the Property in its sole discretion for so long as the Option remains outstanding. Venerable will also be responsible for maintaining the Property in good standing throughout such time. The Optionors will have the right to access the Property and all data, reports and other information generated by Venerable with respect to the Property during the period that the Option is outstanding.

At the closing of the Transaction (the "Closing"), Venerable will enter into a royalty agreement with the Optionors whereby Venerable will grant the Optionors an aggregate 2.0% net smelter returns royalty (the "NSR Royalty") with respect to production of all precious metals from the Property. The NSR Royalty will be payable by Venerable following commencement of commercial production on the Property. The NSR Royalty may be reduced from 2.0% to 1.0% at any time upon Venerable paying $500,000 to the Optionors. If the Optionors receive an offer from a third party to acquire all or any portion of the NSR Royalty, Venerable will have a right of first refusal to acquire such portion of the NSR Royalty on the same terms as set forth in the third party offer.

The parties expect to enter into a definitive agreement with respect to the Transaction on or before March 31, 2011.

Conditions of Closing

Completion of the Transaction will be subject to certain conditions, including:

  1. Venerable and the Optionors obtaining the consent of any parties from whom consent to the consummation of the Transaction is required, including the Exchange and other applicable regulatory authorities, and the shareholders of Venerable, if required;
  2. the Property satisfying the Exchange's Initial Listing Requirements as set out in Exchange Policy 2.1 such that, assuming satisfaction of all other Initial Listing Requirements, Venerable will qualify as a Tier 1 or a Tier 2 Issuer on the Exchange upon completion of the Transaction; and
  3. Venerable and the Optionors completing their respective due diligence.

Sponsorship

Venerable has requested that the Exchange grant a waiver of the sponsorship requirements set out in Exchange Policy 2.2.

Deposit of Funds

Venerable has paid to the Optionors a non-refundable deposit of $25,000, being the maximum non-refundable deposit allowable pursuant to Exchange Policy 2.4.

The Property

The Property is located in the area of the Nechako Plateau, near Vanderhoof, British Columbia. The Property is approximately 6,925 hectares and is prospective for gold and other minerals.

Officers and Directors upon Completion of Transaction

All of the Company's current directors and officers will retain their current positions upon completion of the Transaction. The Company does not expect that any additional directors or officers will be appointed in connection with the Closing. As such, upon completion of the Transaction, the directors and officers of the Company will be as follows:

  Ryan Sharp – President, Chief Executive Officer and Director
  Lisa Sharp – Chief Financial Officer, Secretary and Director
  Doug Wynn – Director
  Glen Dickson – Director
  Wilhelmus G. Kocken – Director

For a description of the backgrounds of each of these individuals, see Venerable's final prospectus, as filed on SEDAR on June 17, 2010.

About the Optionors

Robert Carmichael is a British Columbia resident. Landmark Geological Inc. ("Landmark") is a corporation incorporated under the laws of the Province of British Columbia. James Cuttle, of Whistler, British Columbia, is the sole officer and director of Landmark and is the beneficial owner of all voting shares of Landmark.

Completion of the Transaction is subject to a number of conditions, including but not limited to, Exchange acceptance and if applicable pursuant to Exchange Requirements, majority of the minority shareholder approval. Where applicable, the Transaction cannot close until the required shareholder approval is obtained. There can be no assurance that the Transaction 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 Transaction, any information released or received with respect to the Transaction 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.

ON BEHALF OF THE BOARD

VENERABLE VENTURES LTD.

Ryan Sharp, President and CEO

Disclaimer for Forward-Looking Information

Certain statements in this release are forward-looking statements, which reflect the expectations of management regarding Venerable's proposed qualifying transaction. Forward-looking statements consist of statements that are not purely historical, including any statements regarding beliefs, plans, expectations or intentions regarding the future. Such statements are subject to risks and uncertainties that may cause actual results, performance or developments to differ materially from those contained in the statements. No assurance can be given that any of the events anticipated by the forward-looking statements will occur or, if they do occur, what benefits Venerable will obtain from them.

The TSX Venture Exchange Inc. has in no way passed on the merits of the proposed Transaction and has neither approved nor disapproved the contents of this press release. 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

  • Venerable Ventures Ltd.
    Ryan Sharp
    President and CEO
    (604) 818-1486