Astral Mining Corporation

Astral Mining Corporation

August 05, 2009 11:00 ET

Astral Announces Filing of Preliminary Prospectus for Rights Offering to Shareholders

VANCOUVER, BRITISH COLUMBIA--(Marketwire - Aug. 5, 2009) -


Astral Mining Corporation (TSX VENTURE:AA) ("Astral" or the "Company") announces that it has filed a preliminary short form prospectus with the securities commissions in the provinces of British Columbia, Alberta, Saskatchewan, Manitoba and Ontario relating to a rights offering (the "Offering").

Astral intends to issue to each shareholder, as of a record date to be announced, one transferable right (a "Right") for each common share held. Each Right will entitle shareholders in the participating provinces to purchase one unit of the Company (a "Unit") at a subscription price of $0.25 per Unit. The Rights will be exercisable for 21 days. Each Unit will consist of one common share and one transferable share purchase warrant (a "Warrant"). Each Warrant will entitle the holder to purchase one additional common share of the Company at a price of $0.75 per share for five years from the closing date of the Offering.

The Offering will include an additional subscription privilege under which holders of Rights who fully exercise their Rights will be entitled to subscribe for additional Units, if available, that were not otherwise subscribed for in the Offering. The Company will raise gross proceeds of $644,238 in the Offering. If all the Warrants are exercised, Astral will raise additional proceeds of $1,932,713. The record date and the expiry date for the Offering will be determined at the time of filing of the final short form prospectus.

In support of the Offering, the Company has entered into a standby guarantee agreement with Blackmont Capital Inc. ("Blackmont") under which Blackmont has agreed to purchase all of the Units that remain unsubscribed for at the expiry of the Offering (the "Standby Units").

In consideration of Blackmont's agreement to purchase the Standby Units, Blackmont will receive:

1) a cash fee of $13,125, of which $7,350 was paid upon the execution of the standby guarantee agreement, with the remaining balance payable on the closing of the Offering;

2) an additional cash fee equal to $0.005 per Unit subscribed for under the Offering by the Company's shareholders, other than Units subscribed for by the Company's directors and officers, payable on the closing date of the Offering, estimated at $11,248 (2,249,687 Units x $0.005); and

3) reimbursement of all expenses reasonably incurred by Blackmont, which will not exceed $12,500 without the Company's prior approval.

The Company will also issue a non-transferable warrant, to Blackmont entitling Blackmont to purchase up to 625,000 common shares of the Company at $0.25 per share for a period of six months from the closing date of the Offering.

The Offering and the issuance of the warrant to Blackmont under the standby guarantee agreement are subject to regulatory approval, including that of the TSX Venture Exchange.

The Company intends to use the net proceeds from the Offering to further explore the Jumping Josephine property by carrying out Phases I and II of the work program recommended in the technical report dated July 14, 2009, entitled "Technical Report on 2008 Exploration at the Jumping Josephine Property, South-eastern British Columbia, Canada", prepared by Qualified Person, Andrew J. Turner, P. Geol., as required under National Instrument 43-101 Standards of Disclosure for Mineral Projects. The technical report was filed on SEDAR on July 27, 2009. The Company will also use the net proceeds to pay for preparation of the technical report and for general working capital.

Manfred Kurschner, President and CEO, stated, "This is Astral's first financing since the share consolidation and management feels that it is important and fair that Astral's shareholders have an opportunity to participate in the financing and perhaps lower their cost base per share."

"Shareholders who reside in the participating provinces and exercise their rights to subscribe for units will be able to maintain or increase their current percentage holdings in Astral. Furthermore, the five year warrant gives all participants an opportunity to add to their Astral shareholdings in the future, if the Company continues to advance the Jumping Josephine gold discovery."

This news release does not constitute an offer to sell or the solicitation of an offer to buy securities in any jurisdiction. The Rights and the Units issuable on exercise of the Rights will not be and have not been registered under the United States Securities Act of 1933, as amended, and may not be offered or sold in the United States absent registration or an applicable exemption from the registration requirements.

Astral Mining Corporation is a Canadian company engaged in the exploration and development of precious metal properties in North America. By focusing on exploration in mining-friendly districts, the Company minimizes the political and social risks encountered in many other parts of the world. With a new gold discovery at the Company's Jumping Josephine Gold Project in Southern British Columbia and an experienced technical team and seasoned management, Astral is poised to leverage this expertise into early exploration success. Further details on Astral Mining Corporation and its high-quality portfolio of exploration projects can be found at

Cautionary Note to US Investors: This news release may contain information about adjacent properties on which we have no right to explore or mine. We advise U.S. investors that the SEC's mining guidelines strictly prohibit information of this type in documents filed with the SEC. U.S. investors are cautioned that mineral deposits on adjacent properties are not indicative of mineral deposits on our properties. This news release may contain forward-looking statements including but not limited to comments regarding the timing and content of upcoming work programs, geological interpretations, receipt of property titles, potential mineral recovery processes, etc. Forward-looking statements address future events and conditions and therefore involve inherent risks and uncertainties. Actual results may differ materially from those currently anticipated in such statements.

Astral Shares Outstanding - 2,576,951

2009 number 5

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 accuracy of this news release.

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