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TORONTO, April 6 /CNW/ - YORK RIDGE LIFETECH INC. (TSXV: YRL.P) (the "Corporation"), a capital pool company, announced today that it has entered into a term sheet dated March 31, 2010 that serves as an agreement in principle concerning a proposed transaction (the "Transaction") between the Corporation and Acadian Energy LLC ("Acadian") which, if completed, will be the Corporation's qualifying transaction pursuant to the policies of the TSX Venture Exchange Inc. (the "Exchange").
Acadian Energy LLC
Acadian, a Texas limited liability company originally founded in 2007 is an exploration and development company supplying technology, project management and engineering services to the development of coalbed methane, shale gas and tight gas reservoirs. The company is headquartered in Addison, Texas and is primarily focused on development of unconventional natural gas resources of the New Albany Shale formation in southwestern Indiana, USA.
In September, 2007 Acadian acquired the New Albany Shale assets of CDX Gas, LLC ("CDX") in Indiana, USA. The acquired assets included oil and gas leases in the heart of the active New Albany Shale Gas Play, ten New Albany Shale well bores in Daviess, Dubois and Harrison Counties, and a facility and salt water disposal well in Daviess County. Acadian has since restored natural gas production from the horizontal Knepp No. 28B well it acquired from CDX. Acadian has also acquired additional leases and participated in two (2) horizontal New Albany Shale wells drilled and completed by Noble Energy, Inc. in Sullivan County.
The membership interests of Acadian are held 60% by Acadian Energy Holdings LLC and 40% by Gilbert A. Smith and related parties. Acadian Energy Holdings LLC is owned by John E. McDevitt and related parties or investors. The registered agent for both Acadian Energy LLC and Acadian Energy Holdings LLC is Bruce W. Claycombe, 16475 Dallas Parkway, Suite 400, Addison, Texas USA 75001.
More information concerning Acadian is available on its website: www.acadianenergy.com.
The Transaction will consist of a number of steps including the following:
(a) The ownership interest of Acadian will be transferred to a new
holding company ("Acadian Holdings") established under the laws of
(b) Acadian Holdings will conduct a brokered private placement in an
amount of between $5,000,000 and $15,000,000 (the "Private
(c) The Corporation shall establish a wholly-owned subsidiary ("Merger
Sub") under the laws of Delaware.
(d) Merger Sub will merge into Acadian Holdings whereby Acadian Holdings
will be the surviving company as a wholly-owned subsidiary of the
Corporation and the security holders of Acadian Holdings will receive
securities in the Corporation in exchange for their interests in
(e) The existing directors and officers of the Corporation, with the
exception of Mark Lawrence, will resign their positions upon
completion of the Transaction. The Corporation will, subject to
shareholder approval, increase its board of directors to a number
prescribed by Acadian and nominees representing Acadian will be
elected or appointed as directors and officers.
(f) The Corporation will, on or prior to closing of the Transaction, and
subject to shareholder approval, consolidate its shares, change its
name, restate its option plan and appoint new auditors.
The Transaction is an arm's length transaction. No related party of the Corporation has any interest in Acadian. Accordingly, the Transaction will not, as currently contemplated, be subject to approval by the shareholders of the Corporation.
The parties intend to apply for an exemption from sponsorship requirements under the policies of the Exchange.
There are currently 2,850,000 common shares issued and outstanding in the capital of the Corporation. In addition, there are 285,000 common shares reserved for issuance under the Corporation's stock option plan. The common shares in the capital of the Corporation for the purposes of the Transaction have been valued, subject to adjustments, at $0.30 per share.
The deemed value of Acadian for the purpose of the Transaction is estimated to be $20,000,000, excluding the Private Placement and the proposed conversion of a portion of the indebtedness held by related parties into equity. Assuming a $20,000,000 valuation for Acadian, and $10,000,000 is raised by way of the Private Placement, but prior to debt conversion, an estimated 100,000,000 common shares in the capital of the Corporation will be issued to the shareholders of Acadian and new investors on a pre-consolidation basis.
Transaction Date Extension and Trading Suspension
The Corporation is a capital pool company and, in accordance with Policy 2.4 of the Exchange, was obliged to complete a qualifying transaction on or before February 4, 2010. The Corporation applied for and was granted an extension of the date to complete a qualifying transaction to March 31, 2010. The Corporation did not complete a qualifying transaction on or before March 31, 2010 and consequently has been advised by the Exchange that its shares will be suspended from trading effective today. The Corporation expects to complete the Transaction on or before June 30, 2010 in which event its shares will resume trading.
Completion of the Transaction is subject to a number of conditions, including but not limited to, completion of the Private Placement, negotiation and signing of a definitive business combination agreement, approvals of the board of directors of Acadian and the Corporation, Exchange acceptance, shareholder approval of the share consolidation, name change and change of auditors. The Transaction cannot close until all the conditions are satisfied. There can be no assurance that the transaction will be completed as proposed or at all.
A comprehensive press release with further particulars of the Transaction will follow in accordance with the policies of the Exchange. Trading in the common shares of the Corporation will remain suspended pending the release of more fulsome disclosure regarding the Transaction and the satisfaction of the filing requirements of the Exchange.
As noted above, completion of the 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 approval. Where applicable, the Transaction cannot close until the required shareholder approval is 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 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.
Certain information in this press release may contain projections and forward-looking statements. This information is based on current expectations that are subject to significant risks and uncertainties that are difficult to predict. Actual results might differ materially from results suggested in any forward-looking statements. The Corporation assumes no obligation to update the forward-looking statements, or to update the reasons why actual results could differ from those reflected in the forward looking-statements unless and until required by securities laws applicable to the Corporation. Additional information identifying risks and uncertainties is contained in the Corporation's filings with the Canadian securities regulators, which filings are available at www.sedar.com.
The TSX Venture Exchange Inc. has in no way passed upon the merits of the proposed transaction and has neither approved nor disapproved of the contents of this press release. Neither TSX Venture Exchange Inc. nor its Regulation Services Provider (as that term is defined in the policies of TSX Venture Exchange Inc.) accepts responsibility for the adequacy or accuracy of this press release.
SOURCE YORK RIDGE LIFETECH
For further information: For further information: Mark Lawrence, President, Chief Executive Officer and Secretary, York Ridge Lifetech Inc., E-mail: email@example.com, Tel: (416) 707-6630