Module Resources Incorporated
TSX VENTURE : MLE

Module Resources Incorporated

July 12, 2011 09:30 ET

Module Signs Purchase and Sale Agreement of Carolin Mine and Associated Ladner Gold Properties

VANCOUVER, BRITISH COLUMBIA--(Marketwire - July 12, 2011) -

NOT FOR DISTRIBUTION IN THE UNITED STATES

Module Resources Incorporated (TSX VENTURE:MLE) ("Module" or the "Company") is pleased to announce it has completed its formal Agreement with Century Mining Corporation ("Century") in respect to the purchase of the Carolin Mine, associated Ladner gold properties and accompanying claims, subject to approval by the TSX Venture Exchange. The land package comprises 152 mineral claims covering approximately 7,049 hectares (70 sq. kms.) and 11 land titles in a known and underexplored gold belt with several historic gold mines and numerous gold occurrences on the Company's properties. The revised purchase and sale agreement replaces a more restrictive option agreement Module signed with Century in October 2008.

Terms under the new purchase and sale agreement include:

  • Consideration of $5,000,000 in cash plus 3,500,000 common shares of Module, to be paid or issued in installments over four years to Century for complete ownership of the property.
  • Module receives credit for previous cash payments totaling $60,000 in 2008 and 2009 and issuance of 1,000,000 shares of Module to Century in 2009.
  • Module has acquired an irrevocable 10% earned interest in the mine and area claims held by Century. An additional 40% earned interest will be earned upon completing cash payments totaling $2,500,000 to Century by October 31, 2012.
  • Century retains a 3% NSR royalty which may be repurchased by Module for $1,500,000 per 1%. The NSR will not apply to potential gold recovery from reclamation and reprocessing of the existing tailings impoundment.
  • A "back-in and joint venture" right by Century under the Option Agreement between Century and Module has been terminated.
  • As part of the Agreement Module will acquire Century's active mine permit bond to the BC government, upon payment to Century of $200,000 by August 31, 2011.

Bruce Downing, President and CEO of Module, commented: "The Carolin Mine site and contiguous claims are located a short distance from Hope ,BC and approximately two hours driving time to the mine from Vancouver. The proximity to the Lower Mainland provides for cost effective access to many of the necessary services such as airborne geophysics, drilling companies and general mining development needs, as well as professional and technical services, many of which can be accessed from the immediate area. Existing infrastructure and established roads to the mine site and future development area drilling targets on the nearly 70 sq. km. property will also reduce capital costs associated with our overall development plans. The opportunity for the Company to acquire and expand on an existing gold resource is an exciting one for the Company and I am very pleased to be leading our team and moving ahead with plans for a major exploration and mine development program."

For further Company and technical information, please visit the Company's website at www.moduleresources.com.

The technical information contained in this release has been prepared by Bruce Downing, P.Geo., a qualified person who is the president and CEO of the Company.

ON BEHALF OF THE BOARD OF DIRECTORS

Bruce W. Downing, M.Sc., P.Geo., Hon.FEC, President & Chief Executive Officer

We seek Safe Harbor.

Caution concerning forward-looking information

This news release may contain forward-looking statements that are based on the Company's expectations, estimates and projections regarding its business and the economic environment in which it operates. These statements are not guarantees of future performance and involve risks and uncertainties that are difficult to control or predict. Therefore, actual outcomes and results may differ materially from those expressed in these forward-looking statements and readers should not place undue reliance on such statements. Statements speak only as of the date on which they are made, and the Company undertakes no obligation to update them publicly to reflect new information or the occurrence of future events or circumstances, unless otherwise required to do so by law.

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 the accuracy of this press release.

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