Greater China Capital Inc.
TSX VENTURE : GCA.P

December 24, 2010 14:40 ET

Greater China Capital Inc. Announces Proposed Prospectus Offering

TORONTO, ONTARIO--(Marketwire - Dec. 24, 2010) - Greater China Capital Inc.

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.

Further to a press release dated July 30, 2010, Greater China Capital Inc. ("Greater China") (TSX VENTURE:GCA.P), a capital pool company listed on the TSX Venture Exchange (the "Exchange"), is pleased to announce that it has filed a preliminary prospectus in connection with a proposed offering in which Greater China will seek to raise gross proceeds of a minimum of $9 million and a maximum of $13.3 million in a brokered "best efforts" prospectus offering (the "Offering"). The Offering consists of a minimum of 1,000,000 Common Shares of Greater China (the "Common Shares") and up to a maximum of 1,200,000 Common Shares at a price of $1.50 (which assumes that the proposed consolidation, as discussed below, is approved and implemented, and which equates to a pre-consolidation price of $0.25 per Common Share) for aggregate gross proceeds of a minimum of $1.5 million and a maximum of $1.8 million.

As well, under the Offering, Greater China proposes to issue a minimum of 1,500 and up to a maximum of 2,300 $5,000 principal amount 3 year 10% unsecured convertible debentures ("Debentures") for aggregate gross proceeds of a minimum of $7.5 million and a maximum of $11.5 million. The conversion price of the Debentures will be $3.00 (which again assumes that the proposed consolidation is approved and implemented, and which equates to a pre-consolidation price of $0.50 per Common Share). Greater China has engaged Portfolio Strategies Securities Inc. ("PSSI") to act as agent for the Offering on a commercially reasonable "best efforts" basis.

The securities offered will not be registered under U.S Securities Act of 1933, as amended, and may not be offered or sold in the United States absent registration or an applicable exemption from the registration requirements. This press release is not an offer for sale, or solicitation of an offer to buy, in the United States of any equity shares or any other securities of Greater China.

The Offering is being made in conjunction with the previously announced proposed acquisition of Tiandi (Hong Kong) Energy Technology Co., Limited ("TET") as previously announced in Greater China's July 20, 2010 news release. The proposed acquisition of TET (the "Proposed Transaction") is intended to constitute the "Qualifying Transaction" (as such term is defined in the policies of the TSX Venture Exchange Inc. (the "Exchange")) of Greater China pursuant to Policy 2.4 of the Exchange. It is expected that the combined entity after completion of the Proposed Transaction will qualify as a Tier 1 Technology/Industrial Issuer pursuant to the policies of the Exchange. The Proposed Transaction will not be a Non-Arm's Length Qualifying Transaction (as that term is defined in Policy 2.4). It is intended that the Proposed Transaction shall take place by way of a share exchange. The Offering and the completion of the Proposed Transaction is subject to all necessary regulatory requirements including the approval of the Exchange.

The closing of the Offering is conditional on, among other things, the concurrent closing of the Proposed Transaction, as well as the approval by the shareholders of Greater China of certain matters, discussed more fully below. It is currently anticipated that the Offering will close on a date as agreed upon by Greater China and TET (the "Closing Date") subsequent to the issuance of a receipt for the final prospectus. It is expected that the net proceeds of the Offering will be used by the resulting issuer to fund in part sales and marketing activity, new equipment and tools, research and development, general administrative expenses and the costs of the Qualifying Transaction. However, the bulk of the proceeds are to be used to finance additional inventory and accounts receivables and for general working capital purposes.

A preliminary prospectus containing important information relating to these securities has been filed with securities commissions or similar authorities in the provinces of British Columbia, Alberta, Saskatchewan, Manitoba and Ontario. The preliminary prospectus is still subject to completion or amendment. Copies of the preliminary prospectus may be obtained on Greater China's SEDAR profile at www.sedar.com or from Portfolio Strategies Securities Inc., located at 2 Lombard Street, 3rd Floor, Toronto, Ontario, M5C 1M1. There will not be any sale or any acceptance of an offer to buy the securities until final receipt for the final prospectus has been issued.

Greater China is also pleased to announce that it will hold a shareholders' meeting on Tuesday, February 8, 2011, at the hour of 10:00 a.m. at the head offices of Greater China located at 1020 Denison Street, Suite 200, Toronto, Ontario. At the meeting shareholders will be asked to approve a number of resolutions, including the adoption of Greater China's stock option plan, the election of three additional directors, a special resolution empowering the directors to set the number of directors to be elected at the annual meeting or annual resolutions of shareholders, and a special resolution authorizing Greater China to file Articles of Amendment changing the name of Greater China to "EGE Battery Corp." and consolidating the Common Shares of Greater China on the basis of one (1) post-consolidation Common Share for each six (6) pre-consolidation Common Shares. The closing of the Offering and the completion of the Proposed Transaction is conditional upon shareholder approval of these matters. Shareholders of record as at January 6, 2011, will be entitled to receive notice of, and to vote at, the shareholders meeting.

ABOUT TIANDI (HONG KONG) ENERGY TECHNOLOGY CO., LIMITED

TET is a private company incorporated under the laws of Hong Kong. TET has a wholly owned subsidiary Zhejiang EGE Battery Manufacture Co. Ltd. ("EGE"), a private company incorporated under the laws of People's Republic of China. EGE is ISO9001: 2000 certified and operates as a lead crystal batteries R&D and manufacturing company in Huzhou City, Zhejiang Province. TET possesses a unique proprietary technology and owns five lead crystal battery manufacturing related patents in China. The company's total assets as of July 31, 2010 was RMB 74,464,623 (approximately CAD $11.3 million) and the revenue for the year ended July 31, 2010 was RMB 58,473,273 (approximately CAD $8.4 million) in accordance with the audited financial statements. Management believes that TET has a significant potential for growth with the prospect of continuing to expand its sales in China and worldwide.

Capitalization of the Resulting Issuer

Following the completion of the Proposed Transaction and assuming the consolidation, there will be issued and outstanding 1,493,372 Greater China Common Shares, prior to the issuance of 25,000,000 Common Shares to the TET Shareholders, so that the resulting issuer will have approximately 27,493,372 Common Shares issued and outstanding, assuming the completion of the minimum Offering but any Common Shares issuable upon the conversion of any Debentures that may be issued pursuant to the Offering, and any Common Shares that may be issuable upon the exercise of directors' options and warrants granted to the Agent.

READER ADVISORY

Completion of the Proposed 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 Proposed Transaction cannot close until the required shareholder approval is obtained. There can be no assurance that the Proposed Transaction will be completed as proposed or at all.

Investors are cautioned that, except as disclosed in the information circular, filing statement or prospectus to be prepared in connection with the Proposed Transaction, any information released or received with respect to the Proposed 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.

All information contained in this news release with respect to Greater China and TET was supplied by Greater China and TET, respectively, for inclusion herein, and Greater China and its directors and officers have relied on TET for any information concerning them.

Statements in this press release may contain forward-looking information. Any statements that are contained in this press release that are not statements of historical fact may be deemed to be forward looking statements. Forward-looking statements are often identified by terms such as "may", "should", "anticipate", "expects" and similar expressions. Forward-looking information in this press release includes terms and conditions of the Qualifying Transaction, the Financing and associated transactions. The reader is cautioned that assumptions used in the preparation of any forward-looking information may prove to be incorrect. Events or circumstances may cause actual results to differ materially from those predicted, as a result of numerous known and unknown risks, uncertainties, and other factors, many of which are beyond the control of Greater China. The reader is cautioned not to place undue reliance on any forward-looking information. Such information, although considered reasonable by management at the time of preparation, may prove to be incorrect and actual results may differ materially from those anticipated. Forward-looking statements contained in this press release are expressly qualified by this cautionary statement.

The forward-looking statements contained in this press release are made as of the date of this press release, and Greater China does not undertake any obligation to update publicly or to revise any of the included forward-looking statements, whether as a result of new information, future events or otherwise, except as expressly required by securities law.

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

Contact Information

  • Greater China Capital Inc.
    Charles Qin, President
    Chief Executive Officer and Chief Financial Officer
    (905) 604-2351
    (905) 604-2391 (FAX)
    or
    Tiandi (Hong Kong) Energy Technology Co., Limited
    Jianmin Chen
    President
    86-0572-2635136
    86-0572-3827978 (FAX)