Business
Maple Leaf Reforestation signs agreement to acquire Alfalfa Feedstock Company
(TSX-V: MPE) Last Close: May 13, 2008 - $0.27 Shares Issued: 56,092,327
About this update from Maple Leaf Green World, Inc.
[{"type":"text","content":"\n\n\n\n(TSX-V: MPE)\n\n\nLast Close: May 13, 2008 - $0.27\n\n\nShares Issued: 56,092,327\n\n\nCALGARY, May 14 /CNW/ - Maple Leaf Reforestation Inc. (TSX-V: MPE) (the\n"Company" or "Maple Leaf"), a China-based reforestation company, today\nannounced that it has entered into a binding agreement (the "Agreement") to\nacquire 100% of the shares of Funong Alfalfa Feedstock Supply Limited (the\nVendor or "Funong"), a private Chinese company, for a total consideration of\nRmb$1,000,000 (equivalent of Cdn$160,000) (the "Purchase Price"). Funong is\nlocated in China's northwestern province of Shanxi. The Agreement will make\nMaple Leaf the owner of all capital assets of Funong and all registered\npatents rights currently owned by the Vendor. Such patent rights include two\npatents relating to feedstock processing and two involving machinery. The\nAgreement also includes technology transfers, existing sales/marketing\nnetwork, supply contracts and existing farm leasing agreements.\n\n\nFunong generated revenues of Rmb$4,500,000 (equivalent to Cdn$700,000) in\n2007 and is expecting to grow its production in excess of 2,000 metric tonnes\nof alfalfa feedstock for the first six months of 2008. Maple Leaf anticipates\nthat the acquisition of Funong will provide an immediate flow of cash revenues\nto help fund its Xinjiang operation.\n\n\nThe Purchase Price is payable to the Vendor as follows: (i) 30% or\nRmb$300,000 paid as down payment upon signing of the Agreement; and (ii) 70%\nor Rmb$700,000 payable upon closing by May 30, 2008.\n\n\nIn addition to the foregoing, the transaction is subject to the following\nconditions: (i) that any and all Shareholder loans, advances, debts or other\nsums due to the Shareholders from Funong be cancelled; (ii) that the\nShareholders execute Non-Competition Agreements in a form satisfactory to\nMaple Leaf; and (iii) that Maple Leaf is able to retain the services of\nMr. Guo, Funong's General Manager, with an Employment Agreement that is\nsatisfactory to Maple Leaf and Mr. Guo.\n\n\nPrior to entering into the Agreement Maple Leaf engaged HingHua Public\nAccountants Limited to conduct an appraisal of Funong's operations. Based on\nthe results of this appraisal Maple Leaf's Management feels as though the\nacquisition of Funong is being made at a very reasonabl...