TORONTO, Sept. 29, 2010 (GLOBE NEWSWIRE) -- Xylitol Canada Inc. ("Xylitol Canada", or the "Company") (TSX-V:XYL) is pleased to announce that it has completed its acquisition of certain assets and trademarks of Emerald Forest Sugar Inc., a Denver, Colorado-based producer and marketer of Xylitol and Xylitol-based products ("Emerald Forest").
The total purchase price was US$1,038,653, which was satisfied by a cash payment of US$575,000, the issuance of 1,474,612 common shares at an issue price of $0.25 per share (issued to Douglas Staufer, the founder of Emerald Forest, and two individual creditors of Emerald Forest resident in Colorado) and the issuance of a promissory note in the amount of US$95,000 for a term of two years, bearing interest at the rate of 7% per annum. Mr. Staufer will continue to lead the business and, as part of a broader compensation arrangement, he will receive 300,000 options that will vest over time with an exercise price of $0.25. The Company satisfied the cash portion of the purchase price from a portion of the proceeds of the financing completed at the time of the Qualifying Transaction in April, 2010.
"We are pleased to achieve this important first milestone in our strategy to become a low-cost, high quality producer and marketer of Xylitol and Xylitol-based products," stated Andrew Reid, Xylitol Canada's President and CEO. "Emerald Forest will expand our sales and presence in health and diabetic markets across North America and we expect the transaction to be accretive in the current fiscal year."
About Xylitol Canada Inc.
Xylitol Canada markets xylitol and xylitol based-products and is focused on becoming a major low-cost manufacturer of xylitol and related products, serving the global market from operations in North America.
Xylitol Canada's business strategy is to leverage novel proprietary technology and processes to become North America's premier manufacturer of low cost, high quality xylitol from readily available environmentally-sustainable biomass. Xylitol is an all-natural sweetener which is marketed globally including Canada and the United States and is accepted by the American Food and Drug Administration, the World Health Organization and the American Dental Association. Xylitol contains 75% less carbohydrates and 40% less calories than sugar, has a myriad of oral health benefits including the prevention of tooth decay and is safe for diabetics. To date, wider spread use of xylitol has been limited by the lack of a reliable, low cost, high quality supplier.
For further information about the Company, please contact Andrew Reid, President and CEO, at (416) 567-2331, or by email at firstname.lastname@example.org.
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CONTACT: Xylitol Canada Inc. (416) 567-2331