Canada Pacific Capital Corp.
TSX VENTURE : CPR.P

May 02, 2011 18:24 ET

Canada Pacific Capital Corp. Announces Amended Terms of Qualifying Transaction

TORONTO, ONTARIO--(Marketwire - May 2, 2011) -

NOT FOR DISSEMINATION IN THE UNITED STATES OR THROUGH U.S. NEWSWIRES

Canada Pacific Capital Corp. (the "Corporation" or "Canada Pacific") (TSX VENTURE:CPR.P) announced that further to its press release of January 31, 2011, it has entered into an amended and restated letter of intent (the "Amended LOI") dated as of April 29, 2010 with China Freeze-Dry Inc., a corporation governed under the laws of the British Virgin Islands (the "Target"), and Linyi Shenhe Foodstuff Co., Ltd., a corporation governed under the laws of the People's Republic of China ("Shenhe"). The Amended LOI amends, restates, replaces and supersedes the letter of intent dated January 20, 2011 (the "Original LOI") between the Corporation, the Target and Shenhe. The Corporation is a capital pool company and intends for its acquisition of Shenhe through the Target to constitute its Qualifying Transaction (the "Qualifying Transaction") as such term is defined in the policies of the TSX Venture Exchange (the "Exchange").

Public Offering

Under the Original LOI, the Target and Shenhe contemplated the completion of a private placement of shares of the Target for gross proceeds of up to C$30,000,000. Under the Amended LOI, instead of the Target completing the proposed private placement, the Corporation will proceed with a public offering (the "Offering") concurrently with the completion of the Qualifying Transaction of a minimum of 2,500,000 consolidated common shares of the Corporation ("Post-Consolidation Shares") for gross proceeds of $5,000,000 (the "Minimum Offering") and a maximum of 15,000,000 Post-Consolidation Shares for gross proceeds of $30,000,000. The Offering will be conducted on a commercially reasonable efforts basis pursuant to an agency agreement to be entered into between the Corporation and the agent for the Offering.

Resulting Issuer Proposed Management

Canada Pacific and Shenhe has proposed the following management of the Resulting Issuer:

Shen Dapeng, Proposed Chairman of the Board, President and CEO

Mr. Shen Dapeng has been the president of Shenhe since Shenhe started the production and sale of FD food in March 2001. Shenhe develops steadily to become a leading enterprise of FD food industry in China under his leadership. Mr. Shen Dapeng holds a bachelor's degree from Qufu Normal University.

Shen Demin, Proposed Director

Mr. Shen Dapeng has been the Chairman of Shenhe since March 2001. His successful and rich experience built a good foundation for the proper and rapid development of Shenhe. Mr. Shen Dapeng holds a bachelor's degree in food science from Shandong Agricultural College.

Michael Pesner, Proposed Director

Mr. Pesner has been the President of Hermitage Canada Finance Inc., a financial advisory services company, since September 2004. From September 2002 to September 2004, Mr. Pesner acted as the President of Hermitage International Finance Inc., a financial advisory services company. From 1978 to August 2002, Mr. Pesner was a partner at KPMG at its Montreal office. Mr. Pesner is a chartered accountant and a licensed trustee. Mr. Pesner is currently a director of Richmond Mines Inc., a mining company listed on the TSX and NYSE Amex, Quest Rare Minerals Ltd., a mining exploration company listed on the TSXV, Sand Technology Inc., a software technology quoted on OTCBB, Mint Technology Corp., a financial services technology company listed on the TSXV, Prestige Telecom Inc., a telecommunication services company listed on the TSXV, and Bituman Capital Inc., a capital pool company listed on the NEX. Mr. Pesner holds a bachelor of commerce from McGill University and a bachelor of arts from Concordia University.

Francesco (Frank) Galati, Proposed Director

Mr. Galati has been the President of 2030755 Ontario Limited operating as Bedford Consulting, a management consulting company, since March 2007. From September 2006 to March 2007, Mr. Galati was the President of Wellnx Life Sciences Inc., a nutritional supplement company distributing to USA and Canada. From May 1999 to June 2006, Mr. Galati served as the President and CEO of Destination Products International Ltd., a frozen food company marketing to grocery and retail channels in USA and Canada. Mr. Galati is a certified management accountant. Mr. Galati holds a MBA and a batcher of commerce degree from Windsor University and a bachelor of arts degree from the University of Toronto.

Adam K Szweras, Proposed Director

From January 1996 to June 1997, Mr. Szweras acted as the media relations co-ordinator of the Consulate General of Israel in Toronto, attending to media monitoring and lobbying. In June 1997, Mr. Szweras practiced corporate and securities law with Burns Solicitors, as an associate lawyer. Mr. Szweras continued his securities law practice with Carbonaro Sugar Szweras LLP from March 1999 through August 2001. In December 2001 to August 2004, Mr. Szweras practiced securities law as an associate at Fasken Martineau DuMoulin LLP. Mr. Szweras went on to continue his securities law practice as a partner at Heenan Blaikie LLP from August 2004 to January 2006. In February 2006 Mr. Szweras moved his securities law practice to Fogler, Rubinoff LLP, where he continues to practice law. In November 2006, Mr. Szweras also became a director of Foundation Markets Inc., an exempt market dealer, which position he also currently holds.

Francis N.S. Leong, ProposedDirector

Mr. Leong has been the principal of Sungai River Inc., an international financial consulting company, since October 2003. Prior to Mr. Leong's retirement in August, 2003, he was City Treasurer of The City of Calgary. Mr. Leong currently serves as a director of Boyuan Construction Group, Inc., a residential and commercial construction company listed on the TSX; Andatee China Marine Fuel Services Corporation, a marine fuel production and supplier to fishing boats company quoted on Nasdaq; China Industrial Waste Management Inc., an industrial waste treatment and landfill company quoted on the OTCBB; and China Infrastructure Construction Corporation, a ready mix cement company quoted on the OTCBB. Mr. Leong received a Bachelor of Commerce degree from the National Chengchi University in Taipei, Taiwan in 1968 and a Master of Public Administration from Brigham Young University in Provo, Utah, USA in 1975.

Zhao Yan, Proposed CFO

Mr. Zhao has been the CFO for Shenhe since April 2011. From February 2008 to April 2011, Mr. Zhao was a supervisor at Schwartz Levitsky Feldman LLP, an accounting firm, at its Toronto office. From September 2006 to January 2008, Mr. Zhao was an associate at PricewaterhouseCoopers LLP at its Toronto office. From July 2002 to August 2004, Mr. Zhao was an associate at PricewaterhouseCoopers LLP at its Beijing office. Mr. Zhao is a chartered accountant and a certified general accountant. Mr. Zhao holds a MBA from McMaster University and a bachelor of economics from Central South University of Changsha, PRC.

Judith Hong Wilkin, Proposed Secretary

Ms. Judith Hong Wilkin currently is a lawyer practicing securities law at the law firm of Fogler, Rubinoff LLP, a firm she joined since 2002, except during January to May 2006 when she was a lawyer at the law firm of Freshfields Bruckhaus Deringer at its Hong Kong office. Ms. Wilkin holds a Master of Law degree from York University, a Bachelor of Law degree from the University of Ottawa, a Bachelor of Arts degree from Lakehead University and a Bachelor of Education (Honours) degree from Southwest China University.

Other Terms

No other material terms in the Original LOI has been amended, except that the date on which the companies shall obtain all required approvals has been extended to July 31, 2011.

Completion of the Qualifying Transaction will be subject to the satisfaction or waiver of terms and conditions under the Amended LOI, customary or otherwise, including but not limited to completion of the consolidation of the shares of Canada Pacific, satisfactory completion of due diligence, execution of a definitive agreement on or before May 31, 2011, completion of the Minimum Offering and the receipt of all required approvals and consents, including the approval of the Exchange.

If completed, the proposed transaction is expected to constitute the Corporation's Qualifying Transaction under Policy 2.4 of the Exchange.

THIS PRESS RELEASE, REQUIRED BY APPLICABLE CANADIAN LAWS, IS NOT FOR DISTRIBUTION TO U.S. NEWS SERVICES OR FOR DISSEMINATION IN THE UNITED STATES, AND DOES NOT CONSTITUTE AN OFFER TO SELL OR A SOLICITATION OF AN OFFER TO SELL ANY OF THE SECURITIES DESCRIBED HEREIN IN THE UNITED STATES. THE SECURITIES DESCRIBED HEREIN HAVE NOT BEEN, AND WILL NOT BE, REGISTERED UNDER THE UNITED STATES SECURITIES ACT OF 1933, AS AMENDED, OR ANY STATE SECURITIES LAWS, AND MAY NOT BE OFFERED OR SOLD IN THE UNITED STATES OR TO U.S. PERSONS ABSENT REGISTRATION OR AN EXEMPTION FROM REGISTRATION.

Completion of the Qualifying Transaction is subject to a number of conditions including but not limited to, due diligence, Exchange acceptance and if required by Exchange policies, majority of the minority shareholder approval. Where applicable, the Qualifying Transaction cannot close until the required shareholder approval is obtained. There can be no assurance that the Qualifying 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 Qualifying Transaction, any information released or received with respect to the Qualifying 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 Exchange has in no way passed upon the merits of the Proposed Transaction and has neither approved nor disapproved the contents of this press release.

CAUTIONARY STATEMENTS RE FORWARD LOOKING INFORMATION

This news release contains "forward-looking information" within the meaning of applicable securities laws relating to the proposal to complete the Qualifying Transaction and associated transactions including the Offering, including statements regarding the terms and conditions of the Qualifying Transaction and associated transactions including the Offering. Readers are cautioned not to place undue reliance on forward-looking statements. Actual results and developments may differ materially from those contemplated by these statements depending on, among other things, the risks that the parties will not proceed with the Qualifying Transaction and associated transactions, that the ultimate terms of the Qualifying Transaction and associated transactions will differ from those that currently are contemplated, and that the Qualifying Transaction and associated transactions will not be successfully completed for any reason (including the failure to obtain the required approvals or clearances from regulatory authorities). The statements in this news release are made as of the date of this release. The Corporation undertakes no obligation to comment on analyses, expectations or statements made by third parties in respect of the Corporation, Shenhe and the Target, or their respective financial or operating results or (as applicable), their securities.

NEITHER 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 RELEASE.

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