Radar Signs LOI to Purchase a 25% Interest in a Producing Alabama Coal Company
Vancouver, British Columbia CANADA, March 31, 2009 /FSC/ - LPT Capital Ltd. (LPC.P - TSX Venture), is pleased to announce that Radar has signed a letter of intent (the "LOI") to acquire an ownership stake in (the "Transaction") a private Alabama company ("PrivateCo") whose assets include a producing Alabama coal property (the "Property"). "This is an exciting development as Radar will generate income and cash flow from this investment in an operating coal mine upon closing of the transaction which will reduce Radar's dependency on the financial markets for ongoing funding" said Timothy Bergen, CEO of Radar. Also, this agreement envisions a strategic partnership with PrivateCo to identify, acquire and develop additional coal properties.
THE LOI
Pursuant to the LOI, the Transaction will result in Radar purchasing from JLM's treasury, shares ("JLM Shares") such that Radar will own 25% of the issued and outstanding JLM Shares after such issuance in exchange for US$1,000,000 cash (the "Transaction Consideration"). In addition, pursuant to an option (the "Option"), commencing 12 months after the completion of the Transaction, Radar will have a 12 month option to purchase directly from a shareholder of PrivateCo, for an aggregate exercise price of US$1,500,000, an amount of JLM Shares such that Radar will own approximately 51% of PrivateCo after exercise of the Option. The LOI contemplates the negotiation and execution of definitive documents in relation to the Transaction by April 15, 2009 and completion of the Transaction by May 15, 2009. Upon completion of the Transaction, Radar will have the right to nominate one director to the board of PrivateCo. The LOI contains a covenant that the Transaction Consideration will be used to advance JLM's business strategy of adding potential coal resources and increasing coal production. The LOI contains standstill provisions such that PrivateCo and Radar will not participate in any activities which may reduce the likelihood of the success of the Transaction.
THE PROPERTY
The Property includes a current mining permit, #3868, registered with the Alabama Surface Mining Commission in Jasper, Alabama covering a total area of approximately 130 acres of which 114 acres are the mining area and 16 acres is the designated spoil area. Structurally, the site is located in the Warrior Coal Basin. The strata which underlines and outcrops in this region is of the Pottsville Formation of the Pennsylvanian age. Locally, the strata that outcrops in the immediate vicinity of the mine site includes siltstones, shales, sandstones, underclays, and coal seams associated with the Mary Lee Coal Group. The target seams at the facility are the Mary Lee (high value steam coal), and Blue Creek (metallurgical coal) Seams of the Mary Lee Coal Group. The thickness of the Mary Lee Seam averages approximately 48 inches. The thickness of the Blue Creek Seam averages approximately 16 inches.
PRIVATECO PRODUCTION
PrivateCo has been mining on permit #3868 since March 2008 and in the period from April 2008 to December 2008, PrivateCo removed and sold an approximate total of 23,810 tons of steam grade coal and approximately 23,020 tons of metallurgical grade coal for gross coal sale revenues of approximately $4,314,270.00 and have disturbed less that 35% of acreage minable under the current permit #3868. Current 2009 production, as received from PrivateCo, averages approximately 7,000 tons per month.
In addition to the current permit, PrivateCo indicates that they have surface and mineral control on adjacent lands well in excess of the current permitted area, and of these lands, 360 acres is under permit application and review for near future mining.
FINANCING
Radar anticipates completing a financing in the near future to raise the Transaction Consideration and to fulfil its obligations under the LOI. The details of such financing will be announced in a press release in the near future.
OTHER INFORMATION
The LOI is subject to certain conditions including due diligence by Radar, approval of the Transaction by the board, acceptance of the Transaction by the TSX Venture Exchange and other conditions customary for transactions similar in nature to the Transaction. The Transaction would be an arm's length transaction. There can be no assurance that the Transaction will be completed as proposed or at all.
Certain information contained in this news release with respect to the Property was based on information supplied by PrivateCo for inclusion herein, and with respect to such information, Radar and its board of directors and officers have relied upon PrivateCo.
Dennis Nikols P. Geo., a qualified person, has reviewed and verified the technical mining information contained in this news release.
About Radar Acquisitions Corp.
Radar is a natural resource development company focused on growth through the acquisition, exploration and development of coal resources and resource-related technologies. Radar has currently two major projects under development: the Buick Coal Project which holds significant coal resources in Colorado, USA (see the technical report entitled "Limon Lignite Project, Elbert County, Colorado, USA," dated October 26, 2007 and filed on SEDAR on November 2, 2007), and the RPS Fuels joint venture which develops engineered solid fuel products. Other coal and related opportunities continue to be evaluated on an ongoing basis. For more information about Radar, go to www.radar.ab.ca.
For Further Information:
Corporate Head Office:
Timothy J. Bergen, President
Tel: 403.262.3797
Toll Free: 1.877.262.5888
Email: tbergen@radar.ab.ca
Neither the TSX Venture Exchange nor its Regulation Services Provider (as that terms is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
This news release may contain certain forward-looking information. All statements included herein, other than statements of historical fact, is forward-looking information and such information involves various risks and uncertainties. There can be no assurance that such information will prove to be accurate, and actual results and future events could differ materially from those anticipated in such information. A description of assumptions used to develop such forward-looking information and a description of risk factors that may cause actual results to differ materially from forward-looking information can be found in the company's disclosure documents on the SEDAR website at www.sedar.com. The company does not undertake to update any forward-looking information except in accordance with applicable securities laws.
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