GreenStar Agricultural Corporation

TSX VENTURE : GRE


GreenStar Agricultural Corporation

January 13, 2014 09:14 ET

GreenStar Agricultural Announces Completion of First Tranche of Private Placement

TORONTO, ONTARIO--(Marketwired - Jan. 13, 2014) -

NOT FOR DISSEMINATION IN THE UNITED STATES OR FOR DISTRIBUTION BY ANY UNITED STATES NEWS DISTRIBUTION

GreenStar Agricultural Corporation (TSX VENTURE:GRE) ("GreenStar" or the "Corporation"), a producer of canned tomato paste, canned peaches, mandarin oranges and grapes, and a supplier of fresh mandarin oranges, young bamboo shoots and mature bamboo, is pleased to announce that on January 10, 2014 it closed the first tranche of the non-brokered private placement first announced on December 23, 2013 (the "Offering") pursuant to which it issued 1,643,441 units ("Units") at a price of $0.85 per Unit for gross proceeds of $1,396,925. Each Unit comprises one common share and one common share purchase warrant ("Warrant"), with each warrant entitling the holder to purchase one additional common share of the Corporation at a price of $1.15 until January 10, 2016. The Corporation may raise additional funds, up to the announced total of $6 million in one or more additional tranches.

Of the gross proceeds of $1,396,925, $300,000 or 21.5% of the first tranche was subscribed for by Mr. Guan Lianyun, GreenStar's Chairman and CEO, and $34,255, or 2.5% of the first tranche by two other directors of GreenStar.

A finder's fee of 8% ($56,066.00) was paid to Pope & Company Limited, an arms length finder (the "Finder") with respect to 824,500 Units sold. In addition, the Finder received 8% finder's options to purchase 65,960 units at $0.85 per unit at any time prior to January 10, 2016, with each unit consisting of one common share and one common share purchase warrant, with each warrant entitling the holder to purchase one additional common share at $1.15 per share at any time prior to January 10, 2016.

All securities issued are subject to a four month resale restriction period expiring May 11, 2014.

The Corporation intends to use the net proceeds of the Offering to for expansion of the Pucheng tomato paste processing operations to accommodate the expected increased tomato pulp supply from the acquisition of Bayannur City Beichen Tomato Products Co., Ltd., an Inner Mongolia based tomato pulp producer, as previously described in the Company's press releases dated December 23, 2013 and January 6, 2014 and for general corporate purposes.

All currency references are in Canadian dollars.

This news release is not for distribution to United States newswire services or for dissemination in the United States. The securities offered have not been registered under the United States Securities Act of 1933, as amended, and may not be offered or sold in the United States absent registration or an applicable exemption from registration requirements.

About GreenStar Agricultural Corporation

GreenStar operates two main divisions, agricultural and food processing. The agricultural division is involved in the cultivation and harvesting of agricultural products such as fresh fruit and vegetables, for sale either directly as fresh fruit and vegetables or canned, and sold overseas and domestically. The food processing division is primarily involved in the processing of canned food, which includes canned tomato paste, canned boiled bamboo shoots, canned oranges, canned peaches and various other types of fruits and vegetables.

GreenStar has been operating for over 19 years. Through the application of science and technology in production, quality control and assurance, and business operations and management, GreenStar has focused on maintaining product and reputational excellence with a high standard of food quality. Key assets include a well established management team, modern production facilities, and a close partnership with local farmers.

GreenStar Agricultural Corp. is listed on the TSX Venture Exchange under the symbol "GRE".

For further information on GreenStar please visit our web site at www.greenstaragricultural.com.

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.

Caution Regarding Forward-Looking Information:

Certain statements in this press release may constitute ''forward looking'' statements which involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of the Corporation to be materially different from any future results, performance or achievements expressed or implied by such forward looking statements. When used in this press release, such statements may use such words as ''may'', ''will'', ''expect'', ''believe'', ''plan'' and other similar terminology. These statements reflect management's current expectations regarding future events and operating performance and speak only as of the date of this press release. Forward looking information in this press release includes the statement that the Company may complete further tranches of the private placement and the expected use of proceeds. These forward looking statements involve a number of risks and uncertainties. Some of the factors that could cause actual results to differ materially from those expressed in or underlying such forward looking statements are risk of regulatory approval not being obtained, changes in: international, national and local business and economic conditions; political or economic instability in the Corporation's markets; competition; legislation and governmental regulation; and accounting policies and practices. The foregoing list of factors is not exhaustive. Please see the Corporation's annual MD&A dated April 25, 2013, available on www.sedar.com, for a more detailed description of the risk factors. The Corporation undertakes no obligation to update publicly or revise any forward looking information, whether a result of new information, future results or otherwise, except as required by law.

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