Vatic Ventures Corp. Announces Proposed Qualifying Transaction
3090 Spencer Drive West Vancouver, BC V7V 3C8
NEWS RELEASE
VATIC VENTURES CORP. ANNOUNCES PROPOSED QUALIFYING TRANSACTION
VANCOUVER, BC, May 18, 2010 – Vatic Ventures Corp. (TSX-V: VCV.P) ("Vatic" or the "Corporation") is pleased to announce that it has entered into a mineral property option agreement dated May 17, 2010 (the "Option Agreement") with Eastland Management Ltd., whereby Vatic can acquire an undivided 100% interest in and to certain mineral claims known as the Brookmere property (the "Brookmere Property") located in the Spences Bridge Gold Belt District, British Columbia, Canada (the "Transaction"). The Transaction is subject to approval by the TSX Venture Exchange (the "Exchange") and, if accepted, is intended to be Vatic's "qualifying transaction" as that term is defined in Exchange Policy 2.4 concerning capital pool companies.
Upon the completion of the Transaction, Vatic expects to be listed as a Tier 2 mining issuer on the Exchange and will be engaged in the exploration and development of prospective mineral properties, including the Brookmere Property. To date, Vatic has been a capital pool company with the business of indentifying a qualifying transaction.
Each of Vatic and Eastland are dealing at arm’s length to one another and therefore the Transaction will not be a "non-arm’s length qualifying transaction", as that term is defined in Exchange Policy 2.4. Vatic does not expect that the Transaction will require the approval of its shareholders.
Brookmere Property Highlights
The Brookmere property lies in the Spences Bridge Gold Belt of southern British Columbia and consists of 14 claims totaling 7176 hectares. It is road accessible and lies approximately 35 kilometres south of Merritt, about a 3 hour drive from Vancouver. The property was originally acquired by Almaden Minerals Ltd. Prospecting in 2006 lead to the identification of stream sediment gold anomalies in the northwestern portion of the claim group and one float sample of vein quartz that ran 11.26 gpt Au. Almaden optioned the Brookmere property to Williams Creek Exploration Inc. in 2007. Williams Creek reviewed the data and chose to concentrate their efforts in the southeastern portion of the property, proximal to a granitic intrusions. Two years of prospecting and soil geochemistry in this area failed to locate significant anomalies and they returned the property to Almaden, who subsequently allowed it to lapse.
The northwest corner of the property remains a exploration target of potential. The two silt samples within claim Brookmere 10 strongly the source of the stream sediment anomalies could be the ridge underlying claims Brookmere 6, Brookmere 8, Brookmere 10, Brookmere 13 and Brookmere 14. This would be one of the two target areas on the property. The other target area will be Brookmere 11, which is contiguous to Strongbow’s Shovelnose property. Again stream sediment geochemistry suggests the source of the anomalies in claims Brookmere 11 and Brookmere 12 is the ridge underlying the claims.
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A program of soil geochemistry will be required to evaluate the ridges. A total of 100 line kilometres of soil sampling at a spacing of 50 metres, if undertaken, would result in 2000 soil samples. Prior to the initiation of the grid a two man prospecting crew are recommended to spend two weeks walking the ground to determine grid locations. Total cost is expected to be the $200,000 required as the program for meeting the requirements of the Qualifying Transaction.
The Brookmere property has a recently prepared 43-101 qualified report which recommends a qualifying work program. The report was prepared by Stephen B. Butrenchuk, P.Geol.
Transaction Highlights
Pursuant to the terms of the Transaction, Vatic may acquire a 100% interest in the Brookmere Property by: (i) paying Eastland an aggregate amount of $30,000; of which $15,000 has been paid as a non-refundable deposit and $15,000 shall be paid within 5 business days of TSX Venture Exchange approval of the transaction (the "Closing"), (ii) issuing Eastland an aggregate amount 1,000,000 common shares on Closing, 300,000 shares one year from Closing and 500,000 shares two years from Closing. Eastland will retain a 1.5% net smelter return on the property.
Except for the $30,000 cash payment to Eastland indicated above, Vatic is not required to complete any further cash payment or exploration expenditures under the Transaction. Vatic may terminate its option at any time without further obligation to Eastland under the Option Agreement. However, Vatic does intend to carry out the work program recommended in a current 43-101 report
Vatic (or an independent contractor if mutually agreed by Vatic and Eastland) will act as operator for all exploration expenditures to be incurred by it in respect of the Transaction.
The Transaction is conditional, among other things, to satisfactory due diligence on the property and to Vatic conducting a financing with minimum gross proceeds of $300,000.
Officers, Directors and Insiders
Jim Rankin is the sole director, officer and shareholder of Eastland. Mr. Rankin resides in Delta, B.C.
Directors Monty Qureshi, Nasim Tyab and Michael Cahen will remain as the directors of the Company post closing.
Sponsorship of Qualifying Transaction
Vatic intends to seek an exemption from the sponsorship requirements of the Exchange, but will appoint a sponsor if required to do so.
Trading Halted
In accordance with Exchange policies, Vatic’s common shares are currently halted from trading and will remain so until such time as the Exchange determines otherwise, which, depending on the policies of the Exchange, may not occur until the completion of the Transaction.
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Name Change
On completion of the Transaction, Vatic intends to change its name to "Vatic Resources Inc.".
Finder’s Fee
The Company will pay a finder’s fee in connection with the transaction as permitted by the TSX Venture Exchange.
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.
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.
ON BEHALF OF THE BOARD
VATIC VENTURES CORP.
Per: "Monty Qureshi"
Monty Qureshi President
For further information, please contact:
Monty Qureshi, President Phone: (604) 761-3205
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.
Disclaimer for Forward-Looking Information Certain statements in this release are forward-looking statements, which reflect the expectations of management regarding the Corporation'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 the Corporation will obtain from them. The Company assumes no responsibility to update forward looking statements.