Constitution Mining Amends Terms Required to Purchase 100% Interest in Gold Sands Project
Lima, Peru - April 13, 2010 - Constitution Mining Corp. (CMIN.OB) amended the terms of its Agreement with Temasek Investments Inc. for the purposes of revising the terms required for it to acquire ownership of 100% of the original mineral rights relating to the 382 square kilometres (147.5 square miles) - as previously described in our news release of October 1, 2008.
Constitution had the option to pay, prior to March 31, 2010, US$8 million and issue 4 million restricted common shares to bring its ownership of these mineral rights to 100% ownership from the current 50% ownership. The anticipated increase in ownership will enable Constitution to take full advantage of certain developments that it believes are promising.
The parties have agreed to modify the payment terms required in order for Constitution to acquire 100% of the mineral rights as follows:
In return for a 100% interest in the property's mineral rights, CMIN agrees within 5 business days of the amendment to pay the seller US$1 million, issue 4 million restricted common shares and issue a US$ 7 million, 3 year convertible note with 12% interest payable annually. Principal and/or interest can be taken by the seller by way of cash or units valued at US$0.80 per unit, which consist of one (1) share of Constitution's common stock and one (1) warrant to purchase one (1) share of the Constitution's common stock at an exercise price of $1.10 per share.
Constitution Mining Chairman, Dr. Michael Stocker said, "Increasing our ownership in the property's mineral rights to 100% will make our ongoing exploration plans a good deal more powerful and efficient. Not only that, but it allows us to take full advantage of our promising efforts to date. Based on drill results recently announced, we believe that the Gold Sands district may offer the potential for large-scale, low-cost production of gold by employing modern dredging and processing methods that do not use cyanide, mercury, or other disruptive chemical processes."
About Constitution Mining Corp. The Company's goal is to locate large-scale, commercially viable gold deposits and continuously increase the amount of gold underlying outstanding shares. The Company is interested primarily in geographical areas that are home to several significant proven gold deposits, including highly prospective districts likely to hold further large deposits.
Peru The first and most active project is in the Gold Sands region of Peru, where the Company holds options on 461 square kilometre (178 square mile) of mining property, the largest such block in the district.
The Gold Sands of Peru were laid down by eons of alluvial erosion. For millions of years, the waters of the Santiago and the Maranon rivers have been carving their way through the gold-rich mountain canyons of the Andes, carrying off vast amounts of gold and depositing it in loose gravels and sands - Gold Sands - in the area the Company now controls.
Results from test holes drilled during CMIN's 26-hole Phase I exploratory drill program indicates a potential presence of significant alluvial gold. The Company is now engaged in implementing a Phase II drill program that will focus on grid drilling 2.5 square kilometre regions with an aim to develop gold resource estimates and to gather further data to determine the feasibility of large-scale mining of this vast resource. While the results received from the Phase I drill program were favourable, the Company cautions that these results do not yet indicate the presence of a commercially viable mineral deposit.
The full implementation of these programs will require the company to secure additional financing.
Nevada On April 1st , 2010 CMIN executed a definitive and binding Asset Purchase Agreement with Seabridge Gold Inc. to acquire 30 Nevada-based gold projects comprising of 2,141 claims, primarily located in the heart of Nevada's prolific Walker Lane gold belt. The most advanced project in the package of mineral claims is the Castle Black Rock gold project, which has an NI-43-101-compliant gold resource of 215,000 ounces in the measured and indicated categories (12.38 million tonnes grading 0.54 gram of gold per tonne) and 93,000 ounces in the inferred category (7.95 million tonnes grading 0.37 gram of gold per tonne).
Upon closing of the proposed Seabridge Gold / Nevada transaction, CMIN will discuss its strategy for advancing the existing base of measured, indicated and inferred gold resources - 308,000 ounces.
On behalf of the Board:
Dr. Michael Stocker - CEO Constitution Mining Corp. (CMIN.OB)
If you have any questions regarding the interview, or Constitution Mining generally, please contact our investor relations team at the contact information provided below.
Disclaimer This release contains forward-looking statements that are based on the beliefs of Constitution Mining Corp. management and reflect Constitution Mining Corp. current expectations as contemplated under section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities and Exchange Act of 1934, as amended. When used in this release, the words "estimate, "project," "believe," "anticipate," "intend," "expect," "plan," "predict," "may," "should," "will," "can," the negative of these words, or such other variations thereon, or comparable terminology, are all intended to identify forward-looking statements. Such statements reflect the current views of Constitution Mining Corp. with respect to future events based on currently available information and are subject to numerous assumptions, risks and uncertainties, including, but not limited to, risks and uncertainties pertaining to development of mining properties, changes in economic conditions and other risks, uncertainties and factors, which may cause the actual results, performance, or achievement expressed or implied by such forward looking statements to differ materially from the forward looking statements. The information contained in this press release is historical in nature, has not been updated, and is current only to the date indicated in this press release. This information may no longer be accurate and therefore you should not rely on the information contained in this press release. To the extent permitted by law, Constitution Mining Corp. and its employees, agents and consultants exclude all liability for any loss or damage arising from the use of, or reliance on, any such information, whether or not caused by any negligent act or omission.