GFR Pharmaceuticals Inc.
OTC Bulletin Board : GFRP

September 01, 2005 06:00 ET

GFR Pharmaceuticals Inc. Announces the Signing of a Letter of Intent and Plan of Exchange with Harbin Yinhai Technology Development Ltd.

LAS VEGAS, NEVADA--(CCNMatthews - Sept. 1, 2005) - GFR Pharmaceuticals Inc. (GFRP) (OTCBB:GFRP) President and CEO, Richard Pierce announced the signing of a Letter of Intent and Plan of Exchange with Harbin Yinhai Technology Development Ltd. (YHT).

Harbin Yinhai Technology Development Co., Ltd., established in 1998, is a professional commercial instrument printing enterprise. The business scope of the company covers the printing of bank deposit books, deposit receipts, computer bills and other financial notes, and printing of standard forms for banks and insurance companies, single purpose invoices and other certificates, etc.

Among other terms discussed below, the Letter of Intent also provided that the parties would enter into a plan of exchange to give effect to the share exchange between the shareholders of Yinhai and GFRP. On August 29, 2005, GFRP and Yinhai signed the plan of exchange (the "Plan of Exchange").

Pursuant to the terms of the Letter of Intent and the Plan of Exchange, the parties agreed that GFRP would acquire a 95% interest in Yinhai by issuing 20 million restricted common shares to the shareholders of Yinhai in exchange for their shares in Yinhai. The 20 million shares of common stock will be restricted pursuant to Regulation S under the Securities Act of 1933, and, after issuance, will represent approximately 98% of GFRP's then outstanding shares of common stock.

In Conjunction with the Plan of Exchange GFRP will be selling the two wholly owns subsidiaries GFR Pharma Ltd. and GFR Health Inc.

The exchange of shares is subject to the following conditions:

1. Yinhai will nominate someone to be appointed to the board of directors of GFRP.

2. Yinhai will obtain shareholder approval for the transactions, if necessary.

3. The Board of Directors of both GFRP and Yinhai will approve the transactions.

4. Both parties will have conducted and completed its own due diligence to their satisfaction.

5. GFRP will eliminate all of its material liabilities.

6. GFRP will file a Schedule 14F-1 with the Securities & Exchange Commission pursuant to Rule 14f-1 under the Exchange Act in order to provide advance notice of a change of the majority of directors on the Board of GFRP.

7. Richard Pierce will sell 200,000 shares of common stock to Yinhai or its nominee for the purchase price of $550,000.

8. All of the shares of both GFR Pharma, Inc. and GFR Health, Inc. (collectively, the "Subsidiaries") will be sold to Richard Pierce or his nominee for a purchase price to be negotiated between the parties.

9. All of the debt owed by the Subsidiaries to GFRP will be assigned to Richard Pierce or his nominee for an amount of consideration to be negotiated by the parties.

10. Effective on closing, Richard Pierce will resign as a director and officer of GFRP.

11. GFRP will file Articles of Exchange with the Nevada Secretary of State.

All of these conditions are currently in the process of being satisfied or are being negotiated between the parties. The transactions contemplated in the Letter of Intent and the Plan of Exchange are anticipated to be closed within 45 days of the signing of the Plan of Exchange.

GFRP currently has 1,079,940 shares of common stock issued and outstanding, which are quoted on the OTCBB under the symbol "GFRP". As a result of the transactions contemplated by the Letter of Intent and the Plan of Exchange, there will be a change in control of GFRP.

Certain of these statements contained in this press release may be deemed forward-looking statements. Such statements, and other matters addressed in this press release, involve a number of risks and uncertainties. Among the factors that could cause actual results to differ materially from these statements and matters are the risks and other factors detailed, from time to time, in the Company's reports with the Securities Exchange Commission, including, but not limited to, the Company's Annual Reports on Form 10-K and its quarterly reports on Form 10-Q.

Contact Information

  • GFR Pharmaceuticals Inc.
    Richard Pierce
    (604) 460-8440