Landen Capital Corp.
TSX VENTURE : LAN.P

August 06, 2009 13:44 ET

Landen Enters Into an Agreement With Terraco Gold for Bonanza Property

VANCOUVER, BRITISH COLUMBIA--(Marketwire - Aug. 6, 2009) - Landen Capital Corp. (TSX VENTURE:LAN.P) ("Landen") is pleased to announce that it has entered into an exploration and option agreement (the "Agreement") with Terraco Gold Corp. ("Terraco") (TSX VENTURE:TEN), a Tier 2 TSX Venture Exchange (the "Exchange") listed issuer, dated August 5th, 2009 pursuant to which Landen has been granted a 5 year option to acquire Terraco's undivided interest in the Bonanza Property (the "Property"), a gold exploration property located in La Paz County, Arizona. Terraco holds its interest in the Property through a mining lease agreement with Jim Butt, of Monticello, UT, an arm's length party to both Landen and Terraco (see Terraco's news releases dated December 4, 2004 and January 28, 2005). The proposed transaction constitutes an arm's length qualifying transaction (the "QT") to Landen and is subject to the approval of the Exchange. Upon Exchange approval of the QT, Landen will become a Tier 2 TSX Venture Exchange mining issuer.

Terraco, a corporation incorporated under the Business Corporations Act (Alberta), is a mineral exploration company focused in Nevada, United States of America.

Pursuant to the terms of the Agreement, in order to earn Terraco's interest in the Property, Landen must:

(i) spend an aggregate of USD$1,200,000 on the Property in work commitments (USD$100,000 in years one and two, USD$200,000 in year three, USD$300,000 in year four and USD$500,000 in year five). The USD$100,000 to be paid in year one is a firm commitment of Landen;

(ii) pay to Terraco an aggregate of USD$77,500 in cash (USD$5,000 upon execution of the Agreement, USD$7,500 in year one, USD$15,000 in year two and USD$25,000 in year three and four); and

(iii) issue to Terraco 500,000 common shares upon completion of the QT.

Private Placement

In conjunction with the QT, Landen also, subject to Exchange acceptance, announces a non-brokered private placement (the "Private Placement") of up to 5,000,000 units (the "Units") at a price of CAN$0.10 per Unit, for total gross proceeds of up to CAN$500,000. Each Unit will be comprised of one common share of Landen (a "Share") and one non-transferable share purchase warrant (a "Warrant"). Each Warrant will entitle the holder to purchase one additional Share for a period of 24 months from the date of issuance at a price of CAN$0.20. The expiry date of the Warrants may be accelerated, at the sole option of Landen, to 21 business days following the date on which Landen gives notice that it's common shares have closed for 20 consecutive trading days at a price of CAN$0.30 or greater. Net proceeds from the Private Placement will be used for the expenditures on the Property noted above and working capital requirements.

Landen also proposes to pay to certain arm's length parties a finder's fee in cash and/or securities in connection with purchasers for the Private Placement located through the efforts of such finders.

There are currently 5,700,000 common shares of Landen issued and outstanding. Upon completion of the QT and the Private Placement, Terraco will hold an aggregate of 500,000 common shares of Landen representing approximately 4.7% of the issued and outstanding shares of Landen on a non-diluted basis.

The Property

The Property is located within the Harquahala (or Ellsworth) Mining District of the Little Harquahala Mountains in La Paz County, Arizona and is comprised of 11 unpatented and 9 patented lode mining claims (394 acres) controlled by TGC Holdings Ltd, a wholly-owned subsidiary of Terraco. The Property is eight miles south of the town of Salome, Arizona, and approximately 55 miles southwest of Wickenburg, Arizona. The Property is centered primarily on the historic Harquahala and Golden Eagle Mines. The exploration work to date has included limited prospecting, rock geochemistry, geologic mapping, geophysics and drilling.

Terraco has completed in excess of USD$100,000 of exploration activity on the Property and a National Instrument 43-101, Standards of Disclosure for Mineral Projects ("NI 43-101") compliant Technical Report in compliance with the guidelines of NI 43-101 has been commissioned by Landen and will be filed within 45 days of this press release.

Sponsorship

Landen will be making application to the Exchange for a waiver of the requirement to obtain a sponsor for the QT.

Corporate

It is anticipated that upon completion of the QT, the corporate name and directors of Landen will remain the same. Todd Hilditch, Chief Executive Officer, President, a director and shareholder of Landen and Terry Lashman, the Chief Financial Officer of Landen are also directors, officers and/or shareholders of Terraco. As neither Messers Hilditch (Surrey, B.C.) or Lashman (Vancouver, B.C.) are control persons of either Terraco or Landen, the QT will constitute an arm's length QT for the purposes of Exchange policies and will not be subject to shareholder approval.

Cautionary Statements

Completion of the transaction is subject to a number of conditions, including but not limited to, Exchange acceptance and if applicable pursuant to Exchange Requirements, majority of the minority shareholders approval. Where applicable, the transaction cannot close until the required shareholder approval is obtained. There can be no assurance that the transaction will be completed as proposed or at all.

Investors are cautioned that, except as disclosed in the management information circular or filing statement or other disclosure document of Landen to be prepared in connection with the QT, any information released or received with respect to the QT may not be accurate or complete and should not be relied upon. Trading in the securities of a capital pool company should be considered highly speculative.

This press release includes certain "Forward-Looking Statements" within the meaning of section 21E of the United States Securities Exchange Act of 1934, as amended. All statements, other than statements of historical fact, included herein, including without limitation, statements regarding plans for completion, production potential, other targeted areas and expansion and development plans and objectives of Terraco are forward-looking statements that involve various risks and uncertainties. There can be no assurance that such statements will prove to be accurate and actual results and future events could differ materially from those anticipated in such statements.

ON BEHALF OF THE BOARD

Landen Capital Corp.

Todd Hilditch, Director

The Exchange has not in any way passed upon the merits of the proposed QT and has neither approved or disapproved the contents of this news release.

Contact Information

  • Landen Capital Corp.
    Todd Hilditch
    Director
    604-443-3831