RARA TERRA CAPITAL CORP. ENTERS INTO LETTER OF INTENT TO ACQUIRE RARE EARTH
AND RARE METAL PROPERTY FROM AMERICAN MANGANESE INC. AS ITS QUALIFYING
TRANSACTION

Trading Symbol:  RTX.P - (TSX.V)

VANCOUVER, Dec. 1 /CNW/ - Rara Terra Capital Corp. (TSX-V:RTX.P) ("Rara Terra" or the "Company") today announces it has signed a letter of intent dated November 29, 2010 (the "LOI") with American Manganese Inc. (TSX-V: AMY) ("American Manganese") to acquire up to 60% of the right, title and interest of American Manganese in the Lonnie property (the "Lonnie Property" or the "Property"), a niobium and rare earth property located in the Omineca Mining Division of British Columbia, as more particularly described below (the "Transaction").  The Transaction is subject to the approval of the TSX Venture Exchange (the "Exchange") and is intended to constitute Rara Terra's "qualifying transaction" ("QT") as defined in Exchange Policy 2.4 concerning capital pool companies (the "CPC Policy").

The Lonnie Property

The Lonnie Property consists of 8 mineral claims, totalling 1605 hectares, and is located on Granite Creek, south east of Manson Creek in North Central British Columbia, approximately three hours drive north of Fort St. James.  The Property is more specifically situated at latitude 55º41'N, longitude 124º23'E (UTM 413,300E, 6,171,300N) on NTS Map Sheet 93N/9W.  Altitude on the Property varies between 3200 feet and 4000 feet.  While historically known for its showings of niobium, the Lonnie Property has more recently become of interest for its rare earth elements showings. 

Rara Terra has engaged Norm Tribe, P. Eng., of geological consulting firm N. Tribe & Associates Ltd., for the purpose of preparing a report in accordance with National Instrument 43-101 ("NI 43-101") with respect to the Property. That report will include a proposed work program and budget for the exploration and development of the Lonnie Property. It is anticipated that the Company will be able to cover the costs of this program with its existing resources and the funds obtained through a proposed private placement, as more particularly described below, but, should the actual amounts be greater than anticipated, the Company may need to obtain further financing.

Summary of the Proposed QT

Pursuant to the terms of the LOI, as consideration for the acquisition of the interest in the Lonnie Property, Rara Terra has agreed to pay American Manganese a cash payment of $60,000 and issue it 285,000 common shares of the Company (each, a "Share") over the three year term of the option agreement to be entered into between the Company and American Manganese (the "Definitive Agreement").  Rara Terra has also committed to incur exploration expenditures totalling $500,000 over the three year term of the Definitive Agreement.

As Rara Terra and American Manganese are at arm's length, the proposed Transaction will not be a Non-Arm's Length Qualifying Transaction, as defined in the policies of the Exchange.  Accordingly, it is expected that a valuation will not be required and that the QT will not be subject to approval of the shareholders of the Company.

The QT will be subject to the provisions of the CPC Policy relating to sponsorship and sponsorship requirements. Rara Terra may make an application to the Exchange for a waiver of the sponsorship requirements. There are no assurances that the Exchange will grant such waiver.  If a waiver is not received, Rara Terra expects to retain Global Securities Corp. ("Global Securities") to act as sponsor for the QT pursuant to Global Securities' right of first refusal under Rara Terra's current agency agreement with Global Securities that was entered into in connection with the Company's initial public offering.

Subject to the approval of the Exchange, a finder's fee will be paid to each of David Heyman and Nick Horsley, who are arm's length parties to the Company and American Manganese, in connection with the Proposed Transaction.  The finder's fee payable to Mr. Heyman is expected to consist of a total cash payment of $3,000 and the issuance of a total of 15,000 Shares of the Company.  The finder's fee payable to Mr. Horsley is expected to consist of a total cash payment of $3,000 and the issuance of a total of 15,000 Shares of the Company.

A filing statement in respect of the proposed Transaction will be prepared and filed on SEDAR in accordance with the CPC Policy.  Press releases will be issued when the Definitive Agreement has been entered into and once the filing statement has been filed on SEDAR.

The proposed Transaction is subject to a number of conditions, including, but not limited to, the following: negotiation and execution of the Definitive Agreement; the satisfaction of the initial listing requirements of the Exchange; Exchange approval of the QT; receipt of a report with respect to the Lonnie Property completed in accordance with NI 43-101; entry into a sponsorship agreement or obtaining a waiver of sponsorship; and receipt of the approval of the board of directors of Rara Terra.

The Company's Shares will remain halted pending receipt by the Exchange of certain required materials from the Company. The Company will issue a further news release upon finalization and filing of the aforementioned NI 43-101 compliant report.

Secondary Transaction

Contemporaneous with the QT, Rara Terra shall acquire 100% of the right, title and interest of Golden Santa Cruz S.A., an Argentine Corporation ("GSC") in the Las Chacras property (the "Las Chacras Property"), located in the Sierra Pampeanas range in the province of San Luis in the west of Argentina, for a cash payment of $25,000 and the issuance of 3,000,000 Shares to GSC, which Shares shall be subject to a milestone-driven escrow agreement to be entered into between Rara Terra, GSC's principles and an escrow agent to be selected by Rara Terra. 

The Las Chacras Property is prospective for rare earth elements and is proximal to the Rodeo de Los Molles REE property currently under option by Wealth Minerals Ltd. (TSX-Venture: WML). 

One of GSC's principals, Christopher Ecclestone, will become Chief Executive Officer of Rara Terra as part of this transaction.  At Closing, Alexander Helmel will step down as President and CEO of Rara Terra. 

Christopher Ecclestone is a Principal at the boutique New York investment bank, Hallgarten & Company, which specializes in mining-related concerns.  He is well-known for his consultancy to the rare earths and specialty metals industries.  Prior to this position, he was the head of research at an economic think-tank in New Jersey which he joined in 2001. For ten years prior to that he was the Founding Principal of the Argentine equity research house, Buenos Aires Trust Company, from 1991 until 2001. As such he has a breadth of experience doing business in Latin America.  Prior to his arrival in Argentina, he worked in London as a corporate finance and equities analyst and as a freelance consultant on the restructuring of the securities industry. He has also worked for the Federal and State governments in Australia.  He is a native of Melbourne, Australia and graduated in 1981 from the Royal Melbourne Institute of Technology.

The Concurrent Financing

In connection with the proposed Transaction, Rara Terra also plans to complete a concurrent private placement to raise gross aggregate proceeds of up to $2,950,000, the exact terms of which will be determined at a later date.  The Company intends to use the proceeds of the private placement to fund the acquisition costs of the proposed QT, to finance the work program as detailed in the NI 43-101 report, and to finance the general working capital expenses of the resulting issuer upon completion of the QT.  A finder's fee may be paid on the private placement on terms to be determined.  Rara Terra will issue a subsequent news release once the Company has finalized the terms of the proposed private placement.

The Resulting Issuer

Following completion of the QT, the resulting issuer will be classified as a mining issuer under the policies of the Exchange and will proceed to carry on business in the mining exploration sector.  At the closing of the Transaction (the "Closing"), and subject to compliance with applicable corporate laws, the board of directors of the resulting issuer will consist of Fraser Atkinson, Christopher Ecclestone, Alexander Helmel, John Veltheer and Roger Flowerdew. For a description of the backgrounds of the current officers and directors of Rara Terra, see its final prospectus as filed on SEDAR on June 3, 2010, which is available at www.sedar.com.  At the Closing, Darrell Elliott will resign as a director of Rara Terra but shall remain as a strategic consultant in consideration for the granting, at Closing, of an additional 25,000 options to purchase Shares.   The following is a summary of the backgrounds of the directors and officers of the Resulting Issuer upon closing of the Transaction, other than of Mr. Ecclestone whose background is provided above:

Fraser Atkinson has served as director of the Company since December 18, 2009 and Chairman since December 21, 2009. Mr. Atkinson has been a director and officer of a number of public companies. He has served as Chief Financial Officer of Versatile Systems Inc. since February 2003 and as a director since November 2003.  Versatile Systems Inc. is a public company listed on the Exchange and the Alternative Investment Market (AIM) on the London Stock Exchange that provides technology services. In addition, Mr. Atkinson was a director of Calyx Bio-Ventures Inc., a biotechnology company listed on the Exchange, from July 2008 to December 2009, and a director of Moventis Capital Inc., a financing company trading on the Pink Sheets, from February 2006 to November, 2008.  From October 2002 to December 2005, he served as President of Prospex Capital Corp., a company involved in providing financing for mining and exploration companies.  In addition, Mr. Atkinson was involved in both technology and corporate finance as a partner at KPMG, LLP for over 14 years, until September 2002.  Mr. Atkinson obtained a Bachelor of Commerce from the University of British Columbia in 1980 and his designation as a Chartered Accountant from the Institute of Chartered Accountants of British Columbia in 1982.

Dr. John Veltheer has served as a director and promoter of the Company since December 18, 2009.  Dr. Veltheer has been a director and officer of numerous private and public companies. Since December 2008, he has been employed as a strategic advisor by Network Exploration Ltd., a junior mineral exploration company listed on the Exchange. Since July 2008, he has acted as President and served as a director of Rapidtron, Inc., previously a leading provider of radio frequency smart access control and ticketing/membership systems.  Dr. Veltheer has served as a director of Texada Ventures Inc., a company engaged in the business of the acquisition and exploration of mineral and resource properties quoted on the Over-the-Counter Bulletin Board, since September 2006 and was Chief Executive Officer, Chief Financial Officer, President, Secretary and Treasurer of that company from September 2006 to September 2008.

Alexander Helmel has served as a director of the Company since December 18, 2009 and President and Chief Executive Officer since December 21, 2009.  On April 6, 2010 Mr. Helmel was appointed as a director and subsequently was appointed as President and CEO on June 18, 2010 of 99 Capital Corp., a junior mineral exploration company listed on the Exchange.  Mr. Helmel has served as the President and director since March 2006 and as Chief Executive Officer since August 2007 of Network Exploration Ltd., a junior mineral exploration company listed on the Exchange.  Mr. Helmel obtained his Bachelor of Science degree from the University of British Columbia in 1994 and obtained his Certified Information Systems Auditor (CISA) designation in 2006.

Roger Flowerdew has served as a director of the Company since December 18, 2009 and Chief Financial Officer and Secretary since December 21, 2009. He has operated his own management and finance consultancy since 1986 and has provided executive management services in the areas of corporate finance, marketing and sales, product and business development, strategic planning and corporate reorganization to life sciences and technology companies in Canada, the United States and the United Kingdom.  Mr. Flowerdew has served as the Chief Operating Officer and Chief Financial Officer of Fuseforward International Inc., an asset management software development and sales company, since November 2009.  From October 2008 to July 2009, he served as Chief Executive Officer and director of Calyx Bio-Ventures Inc., a bio-tech company.  From September 2008 to December 2008, he served as a director of Virexx Medical Corp.  From April 2008 to October 2008, he served as Chief Executive Officer and director of Chromos Molecular Systems Inc., a bio-tech company.  Mr. Flowerdew was the Chief Executive Officer and Chief Financial Officer of Radient Technologies Inc., a company that manufactures fine ingredients, from August 2006 to October 2007.  From October 2003 to July 2006, he was the Chief Executive Officer and a director of Cognetix, Inc., a bio-tech company, and he was also the President and Chief Financial Officer of Cognetix from May 2005 to July 2006. From April 2002 to February 2003, he was the Chief Executive Officer and a director of Naturalhealthlink.com, Inc., an alternative medicine internet portal  From January 2002 to February 2010, he was the President and a director of 5G Networks Inc., a broadband internet provider.  He was the Chief Operating Officer of TelStarDataCom Inc., a broadband internet provider, from July 2001 to December 2001.  From August 2000 to December 2000, he was the Chief Financial Officer and Director of European Operations for Hospitality Careers Online Inc., a company involved in international internet recruiting.  Mr. Flowerdew obtained his Bachelor of Arts from Simon Fraser University in May 1980 and his Chartered Accountant designation in December 1982. 

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 shareholder 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 to be prepared in connection with the Transaction, any information released or received with respect to the Transaction 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.

The TSX Venture Exchange Inc. has in no way passed on the merits of the proposed Transaction and has neither approved nor disapproved the contents of this press release.

Global Securities Inc. may be retained as a sponsor in connection with the proposed Transaction.  An agreement to sponsor should not be construed as any assurance with respect to the merits of the Transaction or its likely completion.

About the Company

Rara Terra was incorporated under the provisions of the Business Corporations Act (British Columbia) on December 17, 2009, and is a "capital pool company" as defined in the CPC Policy. The current directors of the Company are Fraser Atkinson, Alexander Helmel, Roger Flowerdew, John Veltheer and Darrell Elliott.   To date, Rara Terra has been engaged in the business of identifying a QT.

About American Manganese

American Manganese is a diversified specialty and critical metal company focusing on potentially becoming the lowest cost producer of electrolytic manganese from its Arizona manganese project.  Larry Reaugh, of British Columbia, Canada, is the President and CEO of American Manganese. Its Chief Financial Officer is Kenneth Wright, of British Columbia and its other directors consist of Andris Kikauka, Edward Lee and Paul Hildebrand, all of whom are residents of British Columbia, and Anthony Santelli, who is resident in New York, USA.  American Manganese has no controlling shareholders.

ON BEHALF OF THE BOARD

RARA TERRA CAPITAL CORP.

Per: "Alexander Helmel"   
Alexander Helmel
President, CEO and Director

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.

Disclaimer for Forward-Looking Information

Certain statements in this release are forward-looking statements, which reflect the expectations of management regarding Rara Terra's proposed QT. Forward-looking statements consist of statements that are not purely historical, including any statements regarding beliefs, plans, expectations or intentions regarding the future.  Such statements are subject to risks and uncertainties that may cause actual results, performance or developments to differ materially from those contained in the statements.  No assurance can be given that any of the events anticipated by the forward-looking statements will occur or, if they do occur, what benefits the Company will obtain from them. 

%SEDAR: 00029867E

For further information:

Rara Terra Capital Corp.
Alexander Helmel, President and CEO
Phone: [phone]