Polar Star Mining Corporation

Polar Star Mining Corporation

March 25, 2009 12:08 ET

Polar Star Board Advises Shareholders to Reject Dissident's Attempt to Take Control

TORONTO, ONTARIO--(Marketwire - March 25, 2009) -


Polar Star Mining Corporation (TSX VENTURE:PSR) ("Polar Star" or the "Company") announced today that its Board of Directors recommends that shareholders vote to elect the management nominees to the Board at the Company's April 17, 2009 Annual and Special Meeting of Shareholders and reject the attempt by dissident shareholder Douglas Willock to take control of Polar Star.

The Board's recommendation and its reasons are included in the Management Proxy Circular and related documents that have been filed on SEDAR (www.sedar.com) and will also be available on Polar Star's website (www.polarstarmining.com).

The Management Proxy Circular, which has been mailed to shareholders, outlines the Board's proven expertise, experience and track record of generating superior returns for shareholders and provides clear reasons for Polar Star shareholders to vote for the Company's nominees to the Board of Directors, using the YELLOW form of proxy that accompanies the Management Proxy Circular.

Since Douglas Willock's dismissal as President and CEO, the Board has moved forward on executing a plan based on focusing on the Company's best assets, a rigorous development process, and proven leadership. At the same time, Mr. Willock has continued to advocate an uninformed and unrealistic agenda while working to reinstall himself as President and Chief Executive Officer, despite his total inexperience in managing exploration of mineral properties.

"Shareholders must protect the future of this Company and choose wisely between an experienced group of directors who have an extensive record of shareholder value creation, and Mr. Willock's hand-picked dissident slate of directors who lack mine operating experience," said Stephen G. Roman, Executive Chairman. "Mr. Willock's slate has a record of impairing shareholder value and fails to provide what is needed to move Polar Star to the next level. He has disclosed no real plan for the Company other than installing his nominees on the Board. This is an attempt by Mr. Willock to take control of Polar Star through the Board without offering any compensation to Polar Star shareholders."

The Board urges all shareholders to vote their YELLOW form of proxy in favour of the Company's nominees to the Board of Directors. Shareholders with questions or requiring assistance in completing their YELLOW form of proxy are asked to contact Polar Star's proxy solicitation agent, Laurel Hill Advisory Services, LLC toll-free at 1-888-812-9185. To be valid, proxies must be received by 10:00 a.m. (Eastern Time) on April 15, 2009.

Accompanying the meeting materials is a letter to all shareholders from Stephen G. Roman and Derek C. Rance, on behalf of the Board of Polar Star. The text of the letter is below:

March 23, 2009

Dear Fellow Polar Star Shareholder:

Your board of directors (the "Board") at Polar Star Mining Corporation ("Polar Star") needs your support to continue to chart a successful course for Polar Star. These are challenging times in business globally, but inevitably these times do also present opportunities in the mining business for experienced professionals. Recent capital in-flow for investors seeking seasoned mining professionals, has, in particular, allowed Polar Star to raise more than $7 million in new investments in February, 2009 to support further exploration of its highly prospective properties.

As you know, Douglas Willock, a current director and former officer of Polar Star, requisitioned a shareholder meeting to put forward a slate of his own hand-picked directors for Polar Star. Your Board has responded by moving up the annual meeting to avoid the waste and duplication of holding two shareholder meetings within a few weeks. For this reason, in addition to the usual annual business of receiving financial statements and appointing auditors, this year's annual meeting presents you with a crucial choice between an experienced group of directors proposed by the current Board and Mr. Willock's hand-picked directors.

Competing Visions for Polar Star

Your Board, since Mr. Willock's dismissal, has moved forward on a plan that focuses efforts on its best assets and ensures that proper decisions are taken with appropriate expert analysis and support. These include:

- additional geophysical investigation and the commencement of exploration drilling on our best prospect, Montezuma. This authorized work has been over the objections of Mr. Willock;

- efforts at the Chepica Project have been suspended pending further technical work to justify the commitment of a further $5 million purchase payment in the face of initial estimated requirements for capital expenditures of $20 million for this as of yet non-material property. If undertaken, this expenditure would result in a substantial dilution of shareholder equity; and

- in order to ensure that the capital of Polar Star is prudently managed, the Board has hired David Libby, a mining engineer with more than 40 years of experience in management, particularly those of Chilean operations, as President and Chief Operating Officer of Polar Star, despite the objections of Mr. Willock.

Mr. Willock continues to push an uninformed and unrealistic agenda of: (i) further investment in the Chepica Project at the expense of exploring the Montezuma Project, the largest and most prospective of all Polar Star holdings; and (ii) reinstalling himself as President and Chief Executive Officer despite his total inexperience with regard to the management of exploration of mineral properties.

Your Board has carefully reviewed and considered Mr. Willock's proposed board of directors. Based on this review, your Board recommends that you ELECT the directors proposed by management and VOTE AGAINST Mr. Willock's change of control attempt.

Reasons to Reject the Willock Change of Control

The reasons for the Board's recommendation are detailed in the attached Management Information Circular (the "Circular"). We strongly encourage you to read the Circular carefully and in its entirety. As described in more detail in the Circular, the reasons for the Board's rejection of Mr. Willock's proposed board (the "Willock Nominees") include:

- the Willock Nominees lack mineral exploration, development and operational expertise;

- the Willock Nominees have no strategic plan for Polar Star;

- the Willock Nominees have no plan for management of Polar Star;

- Mr. Willock seeks control of Polar Star without payment of a change of control premium; and

- Mr. Willock's unjustified commitment to the Chepica Project exposes Polar Star to undue financial risks.

Reasons to Support the Polar Star Nominees

The Board believes its nominees for the Board bring real value to Polar Star through expert, experienced leadership and deserve your support because they:

- are focused on long-term value creation for shareholders;

- bring decades of experience in mineral exploration, development and operations;

- are focused on exploring the most prospective properties to ensure enhanced share value;

- are committed to the highest standards of corporate governance; and

- have a proven previous record of shareholder value creation.

We are confident that you will conclude, as we have, that Mr. Willock's proposed board fails to provide the experience needed to face the challenges and meet the opportunities before Polar Star and is solely an attempt by Mr. Willock to acquire control over Polar Star without offering adequate consideration to Polar Star shareholders.

For the above reasons, we urge you to REJECT the Willock Nominees and VOTE your Polar Star shares in favour of directors proposed by your Board. If you have already voted any of your Polar Star shares, you should withdraw them immediately. Shareholders who have voted their Polar Star shares and who wish to obtain advice or assistance in withdrawing and re-voting their Polar Star shares are urged to contact Laurel Hill Advisory Services, LLC, the information agent and proxy solicitor retained by Polar Star, at one of the telephone numbers listed below. Laurel Hill is available to respond to enquiries surrounding the information in the attached Circular.

On behalf of the Board of Polar Star, we thank you for your continued support.


Stephen G. Roman, Executive Chairman

Derek C. Rance, Director

About Polar Star Mining Corporation

Polar Star was created to acquire advanced stage exploration properties focusing on gold, copper, and uranium. The Corporation's material assets include 20 projects in Chile, which are 100% owned and cover approximately 146,112 hectares.

Forward-Looking Statements

This press 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 Mining Corporation's filings with Canadian securities regulators available on www.sedar.com or the Company's website at www.polarstarmining.com.

The TSX Venture Exchange has not reviewed and does not accept responsibility for the adequacy or accuracy of this release and the information contained herein.

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