VMS Ventures Inc. announce that it has signed a Letter of Intent (“LOI”) outlining terms and conditions to acquire a 100% interest in the Dunlop Reed Lake Claims from W. Bruce Dunlop Ltd..
The Dunlop Reed Lake claims are currently subject to an Option Agreement between the Company and the Vendor dated August 1, 2006 and amended November 1, 2007. The LOI has the following terms and conditions.
The Company shall:
(a) pay to the Vendor the sum of $375,000 on closing of the acquisition (the “Closing”);
(b) issue to the Vendor 3,000,000 common shares of the Company, on Closing, it being acknowledged that such shares will be restricted from transfer for a period of four months in accordance with applicable regulatory requirements;
(c) agree to pay to the Vendor the further sum of $225,000, payable as to $125,000 on the first anniversary of the Closing and the remaining $100,000 on the second anniversary of the Closing. It is acknowledged that the obligation of the Company to make such payments is contingent upon the Company entering into an agreement, on or before the first anniversary date of the Closing, with a third party which provides for the commercial production of the Reed Lake Claims. For the purpose of the LOI, that shall mean the production of ores, concentrates, metals or other mineral products for sale on a commercial basis (“Commercial Production”);
(d) agree to pay to the Vendor a production bonus of $600,000, payable to the Vendor in amounts equal to 20% of any payments received by the Company from Commercial Production, If and when such Commercial Production occurs, concurrent with the receipt of such payments, until the full $600,000 has been paid.
Completion of the acquisition remains subject to execution of a definitive agreement between the parties and the acceptance of the TSX Venture Exchange.
VMS Ventures CEO, Rick Mark, states: “We would like to thank the Dunlop family for their efforts in this negotiation. We appreciate their support and are pleased that they are now significant shareholders in VMS. They have put their trust in us to build wealth for them as shareholders through Reed Lake and the Discovery Zone deposit and our entire VMS and Nickel property package in Manitoba.”
VMS Ventures Inc. is focused primarily on acquiring, exploring and developing copper-zinc properties in the Flin Flon-Snow Lake VMS Belt. The Company also holds the largest land package considered prospective for nickel-copper mineralization at Lynn Lake, which is to date Canada’s third largest nickel producing camp. The Company’s project portfolio consists of the Snow Lake VMS project, the Lynn Lake Gabbros nickel-copper project, the Nickel Belt project, the South Bay nickel-copper-cobalt PGE property, and the Eden Lake Carbonatite Complex, Specialty Metals property. All VMS Ventures Inc. properties are located in the mining friendly province of Manitoba, Canada.