WMI Whetstone Minerals Ltd.

JERSEY, CHANNEL ISLANDS, UK, Aug. 16 /CNW/ -- JERSEY, CHANNEL ISLANDS, UK, Aug. 16 /CNW/ - (TSX Venture: WMI) August 16, 2011 - Whetstone Minerals Ltd. ("Whetstone") is pleased to announce that it has entered into a share purchase agreement (the "Acquisition Agreement") with Duration Gold Limited ("Duration") to acquire the issued and outstanding share (the "Acquisition") of DGL Investments Number Five Mauritius ("DGL") in consideration for the issuance of 27,142,857 common shares of Whetstone ("Whetstone Shares") at a deemed issue price of US$0.175 per share. DGL is a cell in a protected cell company named Clarity Capital Holdings (Mauritius) Limited PCC (the "Mauritius PCC") which is a single level entity that can divide its assets between the different cells in the protected cell company. Concurrent with the completion of the Acquisition, Whetstone also intends to complete a private placement (the "Private Placement") of up to 27,142,857 Whetstone Shares at a price of US$0.175 per share for maximum gross proceeds of US$4,750,000. Whetstone intends to use the proceeds of the Private Placement to fund exploration activities at its mineral properties and for general corporate purposes. The Acquisition and the Private Placement are subject to, among other things, the receipt of all necessary regulatory approvals, including approval of the TSX Venture Exchange ("TSXV"). DGL is wholly-owned by Duration, a body corporate organized under the laws of Jersey which is majority owned by Clarity Enterprises Limited ("CEL"). Allan Dolan, the Chairman and Interim Chief Executive Officer of Whetstone, is a discretionary beneficiary of a trust which owns all of the issued and outstanding shares of CEL. Mr. Dolan owns 177,875 Whetstone Shares, and CEL owns and controls an aggregate of 57,910,449 Whetstone Shares (including 45,000,000 Whetstone Shares owned by Duration), representing, in total, 58,088,324 Whetstone Shares or approximately 47.9% of the presently issued and outstanding Whetstone Shares. As such, the Acquisition will constitute a non-arm's length acquisition under the policies of the TSXV and will be subject to disinterested shareholder approval at an upcoming annual and special meeting of Whetstone shareholders scheduled for September 15, 2011 (the "Meeting"). Accordingly, none of the Whetstone Shares owned or controlled by Allan Dolan or any of his associates or affiliates (including CEL and Duration) will be entitled to vote on the resolution approving the Acquisition at the Meeting. Whetstone anticipates that it will mail a management proxy circular to its shareholders in connection with the Meeting on or about August 22, 2011 and anticipates closing the Acquisition and the Private Placement shortly after the Meeting upon the receipt of all necessary shareholder and other regulatory approvals. DGL Investments Number Five Mauritius DGL indirectly owns, through its Zimbabwe subsidiaries, interests in mining claims comprising a mining project (the "Bembesi North Project") located in Matabeleland North, Zimbabwe, of which claims within the Bembesi North Project area are grouped into eight main groups knows as the Lui Claims Group, the W&B Claims Group, the Tiberius Claims Group, the Peter Pan Claims Group, the Sandy Claims Group, the Inunwa Claims Group, the Ferroro Claims Group and the Mabel's Luck Claims Group. Since its formation in February 2010, DGL has not conducted any operations or business other than its indirect acquisition of the interests in the mining claims comprising the Bembesi North Project. The Bembesi North Project The Bembesi North Project area is mineral rich and has a long history of mineral production of both precious and base metals, including gold. RSC Consulting Ltd. ("RSC") has prepared a National Instrument 43-101 ("NI 43-101") technical report on the Bembesi North Project dated August 15, 2011, entitled "National Instrument 43-101 Technical Report Bembesi North Project, Zimbabwe" evaluating the Bembesi North Project (the "RSC Report"). René Sterk, Consulting Geologist and Director of RSC, the "Qualified Person" under NI 43-101 responsible for preparing the RSC Report, has reviewed and approved the information contained in this press release derived from the RSC Report. A complete copy of the RSC Report will be available for review on Whetstone's SEDAR profile at www.sedar.com. According to the RSC Report, the mines in the Bembesi North Project area, the Hester, W&B, Tiberius, Peter Pan, Ferroro and Mabel's Luck mines have produced a total of 49,539 ounces of gold historically to date. The Bembesi North Project area is located at the centre of the Bulawayo-Bubi Greenstone Belt in the west-central part of the Zimbabwe craton, which is the largest Archean greenstone belt in the Zimbabwe craton. The belt has been a major producer of gold since the beginning of modern mining in Zimbabwe, containing 16 mines that have produced one tonne or more of gold. Several historic Mineral Resource and Reserve estimates have been completed by previous operators on the properties comprising the Bembesi Project, however RSC has not completed the work necessary to verify these historical Mineral Resource estimates. RSC therefore has not treated the previous Mineral Resource estimates as NI 43-101 compliant resources verified by a qualified person. Although the Bembesi North Project area will require further evaluation in due course, RSC believes that the previous historical results provide an indication of the potential of the properties and are relevant to ongoing exploration. Minority Approval In addition to the requirements of the TSXV, the Acquisition will also be considered a "related party transaction" pursuant to Multilateral Instrument 61-101 - Protection of Minority Security Holders in Special Transactions ("MI 61-101"). As such, Whetstone shall not carry out the Acquisition unless it has also obtained minority approval for the transaction in accordance with MI 61-101. For the purposes of MI 61-101, minority approval is determined by excluding the votes attached to Whetstone Shares that, to the knowledge of Whetstone or any interested party or their respective directors or senior officers, after reasonably inquiry, are beneficially owned or over which control or direction is exercised by: (i) Whetstone; (ii) an interested party in the transaction: (iii) a "related party" of an interested party in the transaction; and (iv) a joint actor of any of the foregoing persons. Specifically, as set forth above, the 58,088,324 Whetstone Shares (representing approximately 47.9% of the issued and outstanding Whetstone Shares), beneficially owned or controlled by Mr. Dolan and CEL will be withheld from voting at the Meeting in accordance with MI 61-101. Valuation In accordance with the rules and policies of the TSXV and the requirements of MI 61-101, Whetstone retained Watts, Griffis and McOuat Limited, consulting geologists and engineers, of Toronto, Ontario, Canada ("WGM") to provide a formal valuation (the "Valuation") of the mining claims comprising the Bembesi North Project proposed to be indirectly acquired by Whetstone pursuant to the Acquisition Agreement. WGM's formal valuation range for the mining claims comprising the Bembesi North Project (based on the assumptions and limitations contained therein) is US$4.5 million to US$5.0 million. A copy of and detailed summary of the Valuation will be included in the management proxy circular to be mailed to shareholders. The independent members of the Board of Directors of Whetstone in respect of the Acquisition (being all of the directors of Whetstone, other than Allan Dolan) took into account, among other things, the Valuation in arriving at its decision to approve the Acquisition. Forward-Looking Statements In the interest of providing Whetstone shareholders and potential investors with information regarding Whetstone including management's assessment of the future plans and operations of Whetstone, certain statements contained in this press release constitute forward-looking statements or information (collectively "forward-looking statements") within the meaning of applicable securities legislation. Forward-looking statements are typically identified by words such as "anticipate", "continue", "estimate", "expect", "forecast", "may", "will", "project", "could", "plan", "intend", "should", "believe", "outlook", "potential", "target" and similar words suggesting future events or future performance. In particular, this press release contains, without limitation, forward-looking statements pertaining to the following: expectations of management regarding the proposed Acquisition, including the timing of completion of the Acquisition, the Private Placement to be conducted by Whetstone in connection with the Acquisition, including the use of proceeds thereof, the mailing of a management proxy circular in connection with seeking shareholder approval of, among other things, the Acquisition, the conclusions set forth in the Valuation which are subject to the assumptions set forth therein (including forward-looking assumptions) and certain operational and business plans of Whetstone subsequent to completion of the Acquisition. With respect to forward-looking statements contained in this press release, Whetstone has made assumptions regarding, among other things: future capital expenditure levels; future commodity prices; future gold production levels; future exchange rates and interest rates; the effect of certain legislative initiatives in Zimbabwe, including indigenization reforms on Whetstone; ability to obtain equipment in a timely manner to carry out development activities; the impact of increasing competition; the ability to obtain financing on acceptable terms. Although Whetstone believes that the expectations reflected in the forward looking statements contained in this press release, and the assumptions on which such forward-looking statements are made, are reasonable, there can be no assurance that such expectations will prove to be correct. Readers are cautioned not to place undue reliance on forward-looking statements included in this press release, as there can be no assurance that the plans, intentions or expectations upon which the forward-looking statements are based will occur. By their nature, forward-looking statements involve numerous assumptions, known and unknown risks and uncertainties that contribute to the possibility that the predictions, forecasts, projections and other forward-looking statements will not occur, which may cause Whetstone's actual performance and financial results in future periods to differ materially from any estimates or projections of future performance or results expressed or implied by such forward-looking statements. These risks and uncertainties include, among other things, the following: that the Acquisition and/or the Private Placement may not close when planned or at all or on the terms and conditions set forth herein; the failure of Whetstone to obtain the necessary shareholder, regulatory and other third party approvals required in order to proceed with the Acquisition and the Private Placement; Whetstone's incorrect assessment of various legislative initiatives in Zimbabwe, including the effects of the indigenization reforms being enacted by the government of Zimbabwe on Whetstone; incorrect assessment of the value of the Acquisition; failure to realize the anticipated benefits of the Acquisition; failure to complete planned financing activities; general economic conditions in Canada, Zimbabwe and abroad. Readers are cautioned that this list of risk factors should not be construed as exhaustive. The forward-looking statements contained in this press release speak only as of the date of this press release. Except as expressly required by applicable securities laws, Whetstone does not undertake any obligation to publicly update or revise any forward looking statements, whether as a result of new information, future events or otherwise. The forward-looking statements contained in this document are expressly qualified by this cautionary statement. 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. To view this news release in HTML formatting, please use the following URL: http://www.newswire.ca/en/releases/archive/August2011/16/c4194.html p For further information please contact the Corporation or Charles Vivian of Pelham Bell Pottinger:br/ br/ /p table border="0" tr td valign="top" nowrap="nowrap" align="left" Whetstone Minerals Ltd.br/ Allan Dolan, Chairman and Interim Chiefbr/ Executive Officerbr/ Phone: +44 (77) 9697 3008 /td td valign="top" nowrap="nowrap" align="left" Pelham Bell Pottingerbr/ Charles Vivianbr/ Phone: +44 207 861 3126br/ /td /tr tr td /td /tr tr td valign="top" nowrap="nowrap" colspan="2" align="left" iTo be added to Whetstone's private email list, please conta/iict /iia cr="true" href="mailto:info@whetstoneminerals.com"info@whetstoneminerals.com/a/i /td /tr /table

Copyright