MWP Capital Corp.
TSX VENTURE : MWP.P

October 24, 2005 11:24 ET

MWP Announces Qualifying Transaction

CALGARY, ALBERTA--(CCNMatthews - Oct. 24, 2005) - MWP Capital Corp. (TSX VENTURE:MWP.P) ("MWP" or the "Corporation"), a capital pool company, announces the completion of its initial public offering of 3,000,000 common shares to the public at a price of $0.15 per share for gross proceeds of $450,000. Blackmont Capital Inc. ("Blackmont") acted as agent for the offering. Concurrently with the closing of the offering, the Corporation granted 410,000 incentive stock options to its directors and officers which are exercisable within five years from the date of grant at an exercise price of $0.15 per share. In addition the Corporation granted 300,000 options to Blackmont which are exercisable 24 months from the date of listing. MWP will have 4,100,000 common shares outstanding upon listing on the TSX Venture Exchange ("TSXV"). The common shares will commence trading on the TSXV effective October 25, 2005 under the symbol "MWP.P".

Subsequent to the closing of the capital pool company offering, the Corporation entered into a Letter of Intent (the "Letter of Intent") made October 4, 2005 regarding a proposed amalgamation with Shear Wind Inc. ("Shear Wind"), a privately held company incorporated under the Business Corporations Act (Alberta). The Corporation intends that the amalgamation with Shear Wind (the "Amalgamation") will constitute its "Qualifying Transaction" for the purposes of Policy 2.4 of the TSXV. Following completion of the Amalgamation, the resulting issuer will be classified as an industrial issuer trading on the TSXV.

Pursuant to the terms of the Letter of Intent and subject to TSXV and shareholder approval, the Corporation and Shear Wind will amalgamate in accordance with the Business Corporations Act (Alberta) to create a new company ("Amalco") under the name "Shear Wind Inc." Pursuant to the Amalgamation, all outstanding securities of Shear Wind will be exchanged for Amalco securities on the following basis:

(i) the issuance of one common share of Amalco (the "Amalco Common Share") for each Shear Wind common share outstanding, or an aggregate of 5,901,000 Amalco Common Shares;

(ii) the issuance of one flow-through common share of Amalco (the "Amalco Flow-Through Common Share") for each Shear Wind flow-through common share outstanding, or an aggregate of 15,300,000 Amalco Flow-Through Common Shares;

(iii) the issuance of one flow-through warrant of Amalco (the "Amalco Flow-Through Warrant") for each Shear Wind flow-through warrant outstanding, or an aggregate of 15,300,000 Amalco Flow-Through Warrants exercisable at $0.25 and expiring on December 31, 2005;

(iv) the issuance of one Amalco Flow-Through Warrant in exchange for each Shear Wind flow-through warrant outstanding, or an aggregate of 500,000 Amalco Flow-Through Warrants exercisable at $0.25 and expiring on July 15, 2006.

Under the terms of the Letter of Intent, the Amalco Common Shares will be issued at a deemed price of $0.20 per Amalco Share, for an aggregate deemed value of approximately $4,240,200. The proposed Amalgamation is arms' length. After giving effect to the Amalgamation, Amalco will have 25,301,000 Common Shares and 15,800,000 Warrants issued and outstanding.

About Shear Wind Inc.

Shear Wind is a private company incorporated in the Province of Alberta, with its head office in Calgary, Alberta. Shear Wind is a "private issuer" as that term is defined under Multilateral Instrument 45-106 and none of its securities have traded on any stock exchange. Shear Wind currently has 49 shareholders. Since incorporation in December 2004, Shear Wind has invested its capital resources in wind power generation equipment and infrastructure and as a result Shear Wind has not generated significant revenue to date. In December of 2004, Shear Wind entered into a Joint-Venture Farm-in Agreement with Renewable Energy Services Ltd. ("RESL") for the joint development of wind farm power generation in the Province of Nova Scotia. Together with its joint venture partner RESL, Shear Wind has secured a 15 year power purchase agreement with Nova Scotia Power Inc. for 2.4 MW (Megawatts) of power annually.

Shear Wind Financial Statement Information

Shear Wind is currently preparing its audited financial statements. Shear Wind's unaudited financial statements for the year ended July 31, 2005 show revenue of $29,739 and a net loss of $144,418. Shear Wind has working capital of $1,824,185, total assets of approximately $3,576,395, shareholders equity of $3,576,385, and capital costs of $1,752,200.

Insiders and Board of Directors of the Resulting Issuer

The current directors and officers of Shear Wind are Blair Coady and Michael Magnus. Michael Magnus, of Halifax, Nova Scotia is President and Chief Executive Officer of Shear Wind and Blair Coady, of Calgary, Alberta, is Chairman and founding shareholder of Shear Wind. There are currently no shareholders who own or control, directly or indirectly, more than 10% of Shear Wind's issued and outstanding share capital, other than Michael Wheatley who is also a director of MWP.

Upon completion of the Amalgamation, it is proposed that Messrs. Magnus, Wheatley, Gary Mackenzie, and David Heighington will comprise Amalco's board of directors. Messrs. Mackenzie, Wheatley, and Heighington are currently directors and officers of MWP. The proposed officers of Amalco will be Michael Magnus as President and Chief Executive Officer, and Gary Mackenzie as Chief Financial Officer. In aggregate, the directors and officers of Amalco will hold approximately 5,079,107 shares, or 20%, of the Amalco Shares after giving effect to the Amalgamation.

The following is a summary of the principal occupations for the last five years of the proposed directors, officers and promoters of Amalco.

Michael Magnus - Proposed Chief Executive Officer, President, and Director

For the past fifteen years, Mr. Magnus acted as Executive Vice President of Clearwater Seafood Limited Partnership ("Clearwater"), which is listed on the Toronto Stock Exchange. His responsibilities included the development and overseeing of all initiatives pertaining to marketing, sales, new product development and logistics, both domestically and internationally. Mr. Magnus' objective was to build markets and strategic partnerships in countries such as Japan, China, Taiwan, Korea, U.K., France, Scandinavia, Russia, Germany and the U.S. Over the span of 12 years sales grew from 100 million dollars to in excess of $350 million dollars. In addition, he initiated the foundation of Ocean Nutrition Canada and worked on various acquisition and startup projects in both Europe and Asia. Prior to Clearwater, Mr. Magnus served in various senior management capacities at Kraft General Foods.

Gary Mackenzie - Chief Financial Officer and Director

Mr. MacKenzie, B. Comm, C.A., is currently the President of Springwater Inc., a bottler of spring water in Nova Scotia. In addition, he is the majority shareholder of Quality Graphics 1992 Inc., a manufacturer of plates for the printing and plastics industries. Mr. MacKenzie is a director of Atlantic Industrial Minerals Inc. and Merrex Resources Inc., both public companies listed on the TSXV. He is also the Vice President of Glencoe Resources Ltd., a company developing calcium carbonate in Cape Breton, Nova Scotia, Canada. Mr. Mackenzie is currently the President and Chief Executive Officer of MWP.

Michael Wheatley - Director

Mr. Wheatley has been an Entrepreneur in Atlantic Canada for the past 30 years. In 1976, Mr. Wheatley founded Wacky Wheatley's TV & Stereo Ltd., a chain of electronic stores with locations in the four Atlantic Provinces. Mr. Wheatley also owns several retail and commercial flooring operations as well as a Honda Dealership in Windsor, Ontario. In 1995, Mr. Wheatley was chosen Entrepreneur of the Year for Atlantic Canada in the retail category. In addition to his business acumen, Mr. Wheatley has been involved in community organizations, initiating fund raising campaigns such as "Star Salute" for the IWK Children's Hospital, "Home in a Day" for the United Way and St Mary's University. He has been a guest speaker at sales conventions, the Canadian Armed Forces and in various schools. Mr. Wheatley is currently a director of MWP.

David D. Heighington - Director

Mr. Heighington is a Calgary-based lawyer who specializes in corporate and securities law with a particular focus on publicly traded companies. He has served as a director and officer for numerous publicly traded companies listed on the TSXV. Mr. Heighington is currently a director of MWP.

Sponsorship of Qualifying Transaction

Blackmont, subject to completion of satisfactory due diligence, has agreed to act as sponsor in connection with the Amalgamation. An agreement to sponsor should not be construed as any assurance with respect to the merits of the transaction or the likelihood of completion.

Description of Significant Conditions to Closing

Completion of the Amalgamation is subject to a number of conditions, including but not limited to TSXV acceptance and approval of the Amalgamation by a two-thirds majority of the votes cast by the shareholders of each of Shear Wind and MWP. The transaction cannot close until the required approvals are obtained. There can be no assurance that the 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 transaction, any information released or received with respect to the 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 TSXV has in no way passed upon the merits of the proposed transaction and has neither approved nor disapproved the contents of this press release.

Forward-Looking Statements

This press release may include forward-looking statements including opinions, assumptions, estimates and expectations of future results, cash flow and earnings. Forward-looking statements are subject to a wide range of risks and uncertainties and although the Corporation believes that the expectations represented by such forward-looking statements are reasonable, there can be no assurance that such expectations will be realized.

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

Contact Information

  • MWP Capital Corp.
    Mr. Gary MacKenzie
    President
    (902) 423-7711
    or
    MWP Capital Corp.
    103 Granite Cove Drive
    Five Island Lake, NS B3Z 1A2