/NOT FOR DISTRIBUTION TO UNITED STATES WIRE SERVICES OR DISSEMINATION IN THE UNITED STATES/
TORONTO, Feb. 21, 2012 /CNW/ - Polar Star Mining Corporation ("Polar Star") (TSX:PSR) is pleased to announce that it has executed a definitive option agreement with Kairos Capital Corporation ("Kairos"). Under the agreement Kairos can acquire up to a 75% interest in either or both of Polar Star's Fortuna and Nancagua properties located in Region III and VI respectively, Chile. Kairos shall also have the option, until December 31, 2012, to select a third, non-core, Polar Star property in which to earn an interest.
The agreement is in the form of a standard mineral industry exploration option in which Polar Star has granted four options to Kairos.
The first option requires Kairos to fund a NI 43-101 technical report on the Fortuna and/or Nancagua properties, make a cash payment to Polar Star of $165,000 and complete $850,000 in work commitments and third party option payments with respect to Fortuna and/or $600,000 in work commitments with respect to Nancagua by September 30, 2013 to earn a 51% interest in either or both of the properties.
With respect to Fortuna, the remaining options will grant Kairos a 60% interest in the property upon completing an additional $1,000,000 of work commitments by September 30, 2013; a 65% interest upon completing a further $1,500,000 of work commitments by September 30, 2014, and a 75% interest upon completing a Bankable Feasibility Study on or before September 30, 2021. Work commitments at Fortuna include US$1,450,000 of option payments to a third party in accordance with the Company's original option to purchase agreement.
With respect to Nancagua, the remaining options will grant Kairos a 60% interest in the property upon completing an additional $1,100,000 of work commitments by September 30, 2013; a 65% interest upon completing a further $1,500,000 of work commitments by September 30, 2014, and a 75% interest upon completing an additional $3,000,000 of work commitments or by funding the project to production by September 30, 2017.
With respect to Kairos' option to select a non-core Polar Star property in which to earn an interest, Kairos shall have until December 31, 2012 to make their selection and earn-in requirements will be similar to the Fortuna and/or Nancagua options.
Effective March 1, 2012, Martin Gallon will assume the role of VP Exploration in addition to his duties as Chief Operating Officer. The Company would like to thank Terence Walker for his contributions to the Company during his tenure in that role, and wish him much success in his future endeavors.
Polar Star also announces that on January 31, 2012 it completed a non-brokered private placement of common shares of the Company, at a price of $0.30 per common share, for gross proceeds of $765,000. The net proceeds of the private placement will be used to finance exploration and development programs and for general corporate purposes.
This news release may contain forward-looking statements based on assumptions, uncertainties and management's best estimates of future events. Actual events or results could differ materially from the Company's expectations and projections. Investors are cautioned that forward-looking statements involve risks and uncertainties. Accordingly, readers should not place undue reliance on forward-looking statements. When used herein, words such as "anticipate", "will", "intend" and similar expressions are intended to identify forward-looking statements. For a more detailed discussion of such risks and other factors that could cause actual results to differ materially from those expressed or implied by such forward-looking statements, refer to Polar Star's filings with Canadian securities regulators available on www.sedar.com or the Company's website at www.polarstarmining.com.
About Polar Star
Polar Star is an emerging exploration company with a focus on building value in Chile through discovery and development. Its flagship property, Montezuma, covers 40 kilometres of the West Fault and the cross-cutting Esperanza Fault system and is located between Codelco's Radomiro Tomic - Chuquicamata - Ministro Hales (formerly known as Mansa Mina) group of copper-molybdenum porphyry deposits, and Antofagasta PLC's El Tesoro - Esperanza - Polo Sur group of copper-gold porphyry deposits. The head offices of Polar Star are located in Toronto.
Shares outstanding: 94,956,001 as at February 21, 2012.
For further information:
Adam Rochacewich, CFO
Tel: (416) 368-3496
Email: [email protected]