Sphere Resources Inc. Signs Definitive Agreement to Acquire the McManus Property in Dome Township, in the Red Lake Mining District of Ontario
3/31/2011 1:42:30 PM - Market Wire

VANCOUVER, BRITISH COLUMBIA, Mar 31, 2011 (Marketwire via COMTEX News Network) --

Sphere Resources Inc. ("the Company"), NEX Board of the TSX Venture Exchange (TSX VENTURE:SPH.H), is pleased to make the following announcement:

The Company has entered into a definitive option agreement dated March 29, 2011 (the "McManus Option Agreement") with Camp McMan Red Lake Gold Mines Ltd. of Red Lake, Ontario ("Camp McMan") and Duncan Park Holdings Corporation ("Duncan Park") to acquire from Camp McMan a 100% interest in 17 patented mineral claims and 11 licenses of occupation (the "McManus Property"), covering approximately 325 hectares located in Dome Townships, in the Red Lake Mining District of Ontario. The McManus Property is located approximately 5 kms northeast of the town of Red Lake. The McManus Property adjoins the Company's Dome Property from the north of the southeastern block and to the east from the north eastern block.

For further important details of the Red Lake gold camp, please go to the Company's website at www.sphereresources.com.

Malcolm Stevens, CEO of Sphere Resources, stated, "We are extremely pleased to have signed this agreement as the McManus Property expands our Red Lake property portfolio which now has increased to 3,000 acres. The structural features of the McManus Property combine well with the larger Dome Property and will allow for a more uniform and cost-effective exploration program from a land base bordering the Lake".

The option to acquire the McManus Property is exercisable upon the Company satisfying the following consideration:

--  Payment to Camp McMan of $10,000 upon signing of the initial letter
    agreement dated November 30, 2010 (which has been paid) and a further
    $25,000 and the issue of 300,000 common shares of the Company ("Common
    Shares") upon the signing of the McManus Option Agreement and the
    transfer of title to the McManus Property to Sphere.
--  On or before December 15, 2011, the payment of $50,000 and the issue of
    400,000 Common Shares.
--  On or before December 15, 2012, the payment of $50,000 and the issue of
    500,000 Common Shares.
--  On or before December 15, 2013, the payment of $75,000 and the issue of
    500,000 Common Shares.
--  A work commitment of $1,200,000 over the term of the McManus Option
    Agreement, of which only $100,000 is a firm commitment to be incurred by
    December 15, 2011 and the rest is optional but required to be incurred
    by the applicable dates in order to maintain the option.
--  Payment of all taxes in relation to the McManus Property during the term
    of the option.

Upon the Company's exercise of the option to acquire the McManus Property, Camp McMan retains a 3.5% Net Smelter Royalty, subject to the Company having the right to reduce the 3.5% Net Smelter Royalty to 2% by payment of $500,000 for each 0.5%. The Company will also then be required to pay Camp McMan an annual payment of $10,000 by December 15th of each year during the term of the McManus Option Agreement commencing on December 15, 2014 and until the earliest of a production decision in respect of the McManus Property being made, a reduction of the NSR Royalty, and any return of the McManus Property to Camp McMan.

By virtue of an existing option agreement between Sphere and Duncan Park in respect of the Dome Property (the "Dome Option Agreement"), the McManus Property lies within a mutual area of interest and Duncan Park would have been required to pay the Company 24% of the Company's acquisition costs of the McManus Property if Duncan Park elected to have the McManus Property be part of the Dome Option Agreement. Pursuant to the McManus Option Agreement, the Company has instead granted Duncan Park the option to acquire a 75% interest in the McManus Property, subject to Camp McMan's Net Smelter Return Royalty, by funding all of the Company's option payments and work expenditures under the McManus Option Agreement (totalling $1,410,000). The Company has the right to claw back a 51% interest in the McManus Property by paying Duncan Park four times the expenditures made by Duncan Park, and Duncan Park will then have a 24% interest in the McManus Property. The remaining 25% interest in the McManus Property is subject to the area of interest provision in the Company's agreements with Global Minerals Ltd. with respect to the Dome Property and which the Company is in the process of purchasing, subject to obtaining applicable regulatory approvals (see the Company's news release dated January 27, 2011). Should Duncan Park not exercise its option to acquire a 75% interest in the McManus Property, the area of interest provision in the Dome Option Agreement will become operative again and Duncan Park will be deemed to have elected to have the McManus Property be part of the Dome Option Agreement and various expenditures then paid by Duncan Park under the McManus Option Agreement will be credited towards Duncan Park's payment obligations under the area of interest provision of the Dome Option Agreement.

A finder's fee is payable in regards to this transaction.

The Option Agreement and related transactions remain subject to, among other things, receipt of all requisite regulatory and other approvals, including the approval of the NEX Board of the TSX Venture Exchange.

About Sphere Resources Inc.

Sphere Resources Inc. is focused on identifying and appropriating exploration targets and other high quality assets in major global mining camps with a particular emphasis on precious metals. It is currently involved in exploring for gold mineralization in the Red Lake District of Ontario and in Nevada, USA.

On behalf of Sphere Resources Inc.

Malcolm L Stevens, Executive Chairman and President