VANCOUVER, BRITISH COLUMBIA--(Marketwired - May 9, 2013) - Midnight Sun Mining Corp. (the "Company" or "Midnight Sun") (TSX VENTURE:MMA) is pleased to announce that it has signed a letter of intent with Kam Chuen Resource Holdings Ltd. ("Kam Chuen"), a closely held company based in Beijing, China. The letter of intent is in contemplation of an option agreement to earn a 60% interest in three mineral exploration permits near Solwezi, Zambia that are currently held by Kam Chuen. Kam Cheun is associated with Ying Cheung Mining Industry Development Ltd ("Ying Cheung"), the owner of the Namibian properties currently under option to Midnight Sun.
Under the letter of intent, Midnight Sun can acquire a 60% interest in the permits by issuing an aggregate of 23,000,000 shares to Kam Chuen and incurring $5,500,000 of work expenditures related to the properties according to the following schedule:
(i) 2,000,000 shares issued on receipt of TSX Venture Exchange (the "TSXV") approval to the option (the "Approval Date"), a further 6,00,000 shares 18 months after the Approval Date; and a further 15,000,000 shares 36 months after the Approval Date; and
(ii) $1,500,000 of Expenditures within 18 months of the Approval Date, a further $2,000,000 of Expenditures within 36 months of the Approval Date and a further $2,000,000 of Expenditures within 48 months of the Approval Date.
The letter of intent remains subject to receipt of all necessary regulatory approvals, including the approval of the TSXV.
Furthermore, the Company announces that it has also entered into a Strategic Alliance with Kam Chuen.
Kam Chuen holds an exclusive prospecting license portfolio of over 150 exploration permits covering over 100,000 km2 in five African countries.
As a result of this Strategic Alliance, Kam Chuen has agreed to provide Midnight Sun with full access to its portfolio, as well as first right of refusal regarding the optioning of any of Kam Chuen's exploration permits. In exchange, Midnight Sun has agreed to offer Kam Chuen technical expertise in the management and selection of properties.
President and CEO
The Midnight Sun board of directors have named director Robert (Bob) Sibthorpe President and CEO of the Company. Mr. Sibthorpe holds a B. Sc (Geol) and MBA from the University of Toronto, and has extensive experience in the mineral exploration sector working in geology and business development with senior mining companies, junior explorers, and corporate finance institutions.
Mr. Allan Fabbro will continue to serve Midnight Sun's shareholders as a member of the board of directors.
Stock Option Grant
The Company announces that it has agreed to grant stock options to Ying Cheung, a privately held Hong Kong Corporation, as consideration for a 6 month extension with regard to a decision date on the Klein Aub property option in Namibia. These options allow Ying Cheung to purchase up to 100,000 common shares exercisable at a price of $0.155 per share until April 5, 2018. The grant of the stock options remains subject to receipt of all necessary regulatory approvals, including the approval of the TSXV.
ON BEHALF OF THE BOARD