Dear VMS followers,

A Statement of Defense has been filed in the Manitoba Courts, as of May 31, 2012 in response to the previously announced (April 27,2012) Statement of Claim regarding the Reed deposit near Snow Lake, Manitoba.

VMS considers the filing of the Statement of Claim by W. Bruce Dunlop Limited (N.P.L.) (“Dunlop”) as a thinly veiled attempt to remake, solely in Dunlop’s favour, the December 2nd, 2008 agreement, willingly entered into by Dunlop, and for which Dunlop received 3 million common shares of the Company, a payment of $375,000 and a further potential future payment of $600,000 from revenue to be received from mining operations on the purchased property. It is important to note that the agreement and the consequent payment and share issuance were made long before there was any demonstrable proof that the property, or combined properties, might contain any economic ore body, and at a time when copper prices were in the $1.60 per pound range, which is less than half of the current price of the commodity.

The facts alleged and relied upon by Dunlop to give rise to this action are supported only by unsubstantiated and inaccurate allegations. VMS, in its Statement of Defense, refutes and denies Dunlop’s allegations, primarily through the evidence of clearly written agreements between VMS and Dunlop. In each and every instance, Dunlop’s allegation of facts is clearly and unequivocally refuted by the express provisions of these written agreements.

VMS’s Board of Directors, after due consideration, consider Dunlop’s claim to be frivolous and simply designed to attempt to remake the December 2008 agreement. The claim will be vigorously defended by VMS and, given the nature of Dunlop’s claim, VMS is seeking costs against Dunlop.

Best regards,

Rick Mark
CEO
VMS Ventures Inc. .