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V2 Ventures Plc (HYE)

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Wednesday 02 February, 2011

V2 Ventures Plc

Update


                                V2 Ventures Plc                                
                       ("V2 Ventures" or the "Company")                        

                                    Update                                     

Following the General Meeting of the Company held on 31 December 2009, the
Company disposed of certain assets (including the Company's name) together with
all liabilities of the Company, to Fred Wilson Entertainment Limited ("Fred
Wilson"), a company owned by Michael Swinney, the former Chief Executive
Officer and a current Non-Executive Director of the Company. Under the terms of
the disposal agreement, as announced on 9 December 2009, Fred Wilson would pay
£50,000 in cash in deferred consideration and 10% shares in Fred Wilson (the
"Buyer Shares")which are subject to a call and put option. Michael Swinney, as
the sole owner of the shares of Fred Wilson, also agreed to guarantee the
performance of Fred Wilson's obligation to indemnify the Company in respect of
all amounts owed to Her Majesty Revenue and Custom's ("HMRC") in respect of
PAYE including any penalties for late payment and fines thereon.

As mentioned above, Fred Wilson was to assume a debt owed by the Company to the
HMRC in relation to PAYE payments. The Company has now been informed that the
debt to the HMRC amounted to £62,000, a much higher figure than originally
accounted for in the Company's books. It is also now clear that the Company is
unlikely to receive any additional payments due to it from Fred Wilson in the
near future. The Company has also been informed that talks between HMRC and
Fred Wilson, to settle or novate this debt, have not as yet reached a
successful conclusion.

These recent events more especially the outstanding debt to HMRC leaves the
Company in unexpected and severe financial difficulties. The Company has not
been able to pursue any new investment/development opportunities as per the
business plan due to the HMRC issue. The executive directors have therefore
concluded that it would be in the best interests of the company to seek
immediate legal advice as to the enforceability of the agreements between the
Company and Fred Wilson and, in particular the personal guarantee given by
Michael Swinney and Wendy Rosenthal in relation to the HMRC debt.

Simultaneously with these events, the Company has received resignation
notifications from both Michael Swinney and Wendy Rosenthal. The executive
directors believe however that at this stage, it is in the best interest of the
Company if the resignation requests remain unactioned by the Company. However,
given recent developments, Michael Swinney and Wendy Rosenthal have been
suspended from the board with immediate effect.

The Company will notify Shareholders accordingly on the progression of this
matter.

The directors accept responsibility for this announcement.

                                    --END--                                    

Enquiries:

V2 VENTURES PLC Tel: 020 8834 1652
Sebastian Moonjely

RIVINGTON STREET CORPORATE FINANCE Tel: 020 7562 3373
Eran Zucker
[email protected]


                                                                                                                                                  

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