Shelton Canada Corp.

Shelton Canada Corp.

January 30, 2007 12:09 ET

Shelton Canada Corp.: News Release

EDMONTON, ALBERTA--(CCNMatthews - Jan. 30, 2007) - Shelton Canada Corp. ("Shelton")(TSX VENTURE:STO) is pleased to announce that it has received TSX Venture Exchange final acceptance for a private placement (the "Private Placement") of an aggregate of 3,980,000 units ("Units") for gross proceeds of $995,000 previously announced on November 16, 2006. Each Unit is comprised of one common share ("Common Share") and one-half ( 1/2) Common Share purchase warrant. Each whole warrant entitles the holder to purchase one (1) additional Common Share at a price of $0.40 per Common Share for a period of eighteen (18) months following the date of closing. This Private Placement follows an earlier private placement of $100,000 previously announced on June 6, 2006.

Zenon Potoczny, President of Shelton, states "the receipt of these funds is very timely in that it will allow Shelton to pursue its acquisition and development strategies in Ukraine."

Shelton has issued a finder's fee to Canaccord Capital Corporation in connection with the Private Placement. As compensation, Canaccord Capital Corporation was paid a sum of $14,700 and was granted an option to purchase 58,800 Units (the "Canaccord Options") of Shelton on the same terms and conditions as the Private Placement.

All Common Shares issued under the Private Placement, Common Shares issued upon exercise of the warrants and the Canaccord Options are subject to a restricted period and may not be traded for a four month period expiring on May 24, 2007.

Shelton intends to use the proceeds from the Private Placement for general working capital purposes.

Pursuant to the policies of the TSX Venture Exchange and Ontario Securities Commission Rule 61-501 ("OSC Rule 61-501") the Private Placement may be classified as a "related party transaction" as Zenon Potoczny, a director of Shelton (the "Related Party") subscribed for Units.

The Private Placement was approved by the independent directors of Shelton who believed that the Private Placement was necessary and that the terms thereof were reasonable in the circumstances of Shelton. The Related Party did not enter into any agreement with Shelton in connection with the Private Placement other than subscription agreements containing customary terms and conditions for a transaction of this nature.

Shelton determined that exemptions from the formal valuation and minority shareholder approval requirements under OSC Rule 61-501 were available. In particular, the exemption set out in paragraph 8 in section 5.5 of OSC Rule 61-501 is applicable. As well, the Common Shares of Shelton are not quoted or listed on a specified market, namely the Toronto Stock Exchange, the New York Stock Exchange, the American Stock Exchange, the NASDAQ Stock Market, or a stock exchange outside of Canada and the United States, such that the valuation exemption in paragraph 3 of section 5.5 of OSC Rule 61-501 is also available.

In addition, in reviewing the minority shareholder approval exemptions, the independent directors determined that the exemption set out in paragraph 3 in section 5.7 of OSC Rule 61-501 is applicable.

Shelton, a junior oil and gas company listed on the TSX Venture Exchange, holds interests in producing properties located in northeastern British Columbia and north central Alberta. Shelton also holds petroleum and natural gas concessions in southern Ukraine.

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

Contact Information

  • Shelton Canada Corp.
    Zenon Potoczny
    President & CEO
    (416) 252-4101
    Shelton Canada Corp.
    Richard Edgar
    (403) 205-2526 ext 4