Radar Acquisitions Corp.

Radar Acquisitions Corp.

June 05, 2007 09:00 ET

Radar Acquisitions Enters Into LOI for Engineered Re-Fuel Technology and Coal Slurry Pond Projects; Announces Private Placement

CALGARY, ALBERTA--(Marketwire - June 5, 2007) - Tim Bergen, President and CEO of Radar Acquisitions Corp. ("Radar") (TSX VENTURE:RAC) is pleased to announce that Radar has signed an arm's length Letter of Intent ("LOI") with New Energy USA, LLC ("New Energy") to explore the possibility of establishing a Joint Venture to utilize New Energy's Re-Fuel technology process (the "Re-Fuel Technology") to develop engineered solid fuel products using a combination of coal slurry pond waste and biomass. The Re-Fuel Technology is a patent pending process that utilizes a coal waste product and combines it with bio-mass to produce an engineered solid fuel product called Re-Fuel. The Re-Fuel technology has been licensed for use on three projects sites in the United States to date.

The LOI sets out terms whereby Radar, through ownership of 50 percent of the JV Entity, has an option to acquire a 50 percent interest in New Energy's four proposed projects ("the Projects"), as well as the option to participate in additional projects, for consideration of US$1 million in common shares of Radar (at a deemed price of US$0.25/share for an aggregate of four million Radar common shares), at which time the parties will enter into a Joint Venture and create a legal entity (the "JV Entity") to develop, market and pursue the business of developing the Projects. Three quarters (3/4) of the shares will have performance escrow restrictions such that one quarter (1/4) of the shares will be released upon the commencement of production of engineered solid fuel from each of Projects 1, 2 and 3. New Energy will have no voting rights to Radar shares while they are held in escrow. After three years, any shares remaining in escrow will be cancelled. At present, New Energy and Radar have not selected a property or secured property rights for any of the Projects under the LOI.

In addition, the LOI contemplates payments by Radar of: US$150,000 paid to New Energy and used to secure or maintain ownership in the Projects; US$2,250,000 paid to the JV Entity upon the first of the Projects reaching the feasibility stage, and provided that the monies are used to secure equipment and maintain property ownership; and US$2,250,000 paid to the JV Entity upon final equity payment for equipment for the first of the Projects, and provided that the monies are used to complete the equipment purchase and maintain property ownership. With regards to the option to acquire additional projects (the "Independent Projects"), the JV Entity will have a Right of First Refusal ("ROFR") to purchase up to 100 percent of any such projects staked, acquired, or otherwise obtained by New Energy and/or Radar.

The LOI is subject to a number of conditions, including the receipt of director, regulatory and shareholder approval, if applicable; completion of satisfactory due diligence; negotiation of a definitive agreement; the Projects meeting feasibility criteria; and other customary conditions for transactions of this nature. The final details of the Joint Venture agreement will be determined once all pertinent due diligence is successfully and satisfactorily completed.

Mr. Bergen said "The management teams of Radar and New Energy have worked diligently over the last several months to bring this Joint Venture to fruition and are excited about the potential this opportunity holds for the shareholders of both companies."

Radar also intends to complete a non-brokered private placement of up to six million units at a price of C$0.25 per unit for gross proceeds of up to C$1.5 million. Each unit will consist of one common share and one half of a common share purchase warrant. Each whole warrant is exercisable at C$0.45 per common share for a period of two years from closing. A finder's fee of up to seven percent of the gross proceeds of the private placement, and a finder's option exercisable into common shares for two years from the date of issuance of up to seven percent of the number of units sold, may be paid on all or any portion of this private placement. It is not anticipated that any new insiders will be created, nor that any change of control will occur, as a result of the private placement. Proceeds of the private placement will be used for lease maintenance and evaluation of the Colorado coal deposit; the first commitment and due diligence for the LOI mentioned above; repayment of short term debt; a reservation for working capital; and for general operating purposes. The completion of the private placement is subject to regulatory approval.

Radar is also announcing that the company has retained Ascenta Capital Partners Inc. ("Ascenta") of Vancouver, British Columbia, to provide investor relations and financial communication services. Ascenta is a full and comprehensive provider of investor relations services. Ascenta will assist Radar in fostering productive, continuing dialogues with analysts, brokers, investors and other financial professionals.

Ascenta will receive a monthly retainer of C$5,500 for an initial 12-month term. Radar will also issue as compensation to Ascenta a total of 350,000 incentive stock options (the "Options"), 125,000 of which will be granted immediately and are exercisable at C$0.26 per share. The remaining 225,000 Options will be granted at a later date and at a price to be determined. The options shall vest in accordance with TSX Venture Exchange guidelines and Radar's stock option plan and will expire 30 days after the expiration of the contract.

Radar will continue to update shareholders on the progress of future corporate news, financings, and project developments. Management welcomes the opportunity to present detailed project information to shareholders or other interested parties.

All statements, other than statements of historical fact, included herein 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. Important factors that could cause actual results to differ materially from the Company's expectations are disclosed in the Company's documents filed from time to time with the TSX-Venture Exchange, the Alberta Securities Commission, and the British Columbia Securities Commission.

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

Contact Information

  • Radar Acquisitions Corp.
    Corporate Head Office:
    Timothy J. Bergen, President
    (403) 262-3797 or Toll Free: 1-877-262-5888
    Email: tbergen@radar.ab.ca
    Ascenta Capital Partners Inc.
    Rory Quinn
    Investor Relations
    (604) 684-4743 ext 226 or Toll Free: 1-866-684-4209
    Email: rory@ascentacapital.com