McVicar Industries Inc. and Jite Technologies Inc. Enter Merger Agreement

TORONTO, April 16, 2012 /CNW/ - McVicar Industries Inc. ("McVicar" TSXV symbol MCV) and its 93.7% owned subsidiary, Jite Technologies Inc. ("Jite" TSXV symbol - JTI) announce today that they have entered into a merger agreement (the "Merger Agreement") pursuant to which Jite has agreed, subject to regulatory approval, to amalgamate with 1872706 Ontario Limited, a wholly owned subsidiary of McVicar, to form a new corporation to be named Jite Technologies Inc. which will be a wholly owned subsidiary of McVicar.

The proposed amalgamation (the "Amalgamation") is a second step transaction which follows McVicar's acquisition on April 5, 2012 of 7,517,356 shares or 37.45% of the issued shares of Jite pursuant to a February 28, 2012 formal take-over bid (the "Bid") which expired at 5:00 p.m. (Toronto time) on April 4, 2012.  McVicar now holds 18,701,606 shares of Jite or 93.67%.  McVicar agreed to pursue such a second step transaction pursuant to subsection 2.5 of the previously announced support agreement dated January 30, 2012 and stated its intention to do so in the take-over bid circular issued in connection with the Bid.

On the Amalgamation each outstanding Jite common share, other than those held by shareholders who exercise their dissent and appraisal rights under section 185 of the Business Corporations Act (Ontario) and by McVicar which will be cancelled, will be exchanged for one redeemable preferred share of the amalgamated corporation, which will be redeemed by the amalgamated corporation at a redemption price of $0.60 per preferred share as soon as possible following the Amalgamation. All of the issued shares of 1872706 Ontario Limited (currently held by McVicar) will be exchanged for shares of the amalgamated corporation.  Consequently, completion of  the Amalgamation will result in McVicar having effectively acquired 100% of the issued shares of Jite.

Following the completion of the Amalgamation, Jite will cease to meet the continuing listing requirements of the TSX Venture Exchange and will be de-listed.  In addition, McVicar will take all necessary steps to cause Jite to cease to be a reporting issuer (or equivalent) in all provinces of Canada in which the Corporation is currently a reporting issuer (or equivalent).

Under the Merger Agreement, completion of the Amalgamation is subject to certain conditions including the requirement for McVicar to provide sufficient funds to the amalgamated corporation to pay the cost of redeeming the preferred shares issued to shareholders of Jite and McVicar being satisfied, in its discretion, that any exercise of dissent rights by holders of Jite shares shall not adversely affect the completion of the Amalgamation or the financial position of the amalgamated corporation following completion of the Amalgamation.

Under applicable corporate law the Amalgamation must be approved by a special resolution passed by a majority of at least two-thirds of the votes cast at a meeting of the shareholders of Jite.  To this end an annual and special meeting of shareholders of Jite has been called for Thursday, May 31, 2012.  An information circular including the requisite disclosure concerning the Amalgamation will be mailed to shareholders as soon as possible.

The Amalgamation is a 'second step business combination' within the meaning of Multilateral Instrument 61-101 - Protection of Minority Security Holders in Special Transaction ("MI 61-101") of the Canadian Securities Administrators which requires, unless an exemption is available, a formal valuation of Jite and approval by a majority of the Jite shareholders other than McVicar and its associates and affiliates.  As a formal valuation was prepared and filed in connection with the Bid and the takeover bid circular mailed in connection with the Bid contained the required disclosure including the statement of McVicar's intention to pursue a second step business combination if insufficient shares of Jite were tendered to the Bid, the Amalgamation is exempt from the formal valuation requirement of MI 61-101.

As McVicar now holds in excess of 90% of the issued shares of Jite, and an appraisal remedy is available to dissenting shareholders of Jite, the Amalgamation is exempt from the minority approval requirement otherwise applicable under MI 61-101 by virtue of section 4.6(1)(a).  However, Jite intends to comply with such requirement notwithstanding such exemption in order to satisfy policy concerns of the TSX Venture Exchange.  The Corporation will therefore exclude the votes attaching to Jite shares held by McVicar at the date of the Bid and those held by persons who are officers, directors or insiders of McVicar in determining whether the requisite majority approval has been obtained.

McVicar relies on the provisions of section 8.2 of MI 61 - 101 which provides that McVicar may treat shares of Jite acquired pursuant to the Bid as "minority" shares and vote them in favor of the Amalgamation.  Accordingly, McVicar has advised the Corporation that it intends to cause the 7,517,350 Jite Shares acquired pursuant to the Bid (other than 122,290 Jite Shares acquired from persons who are directors or officers of McVicar), amounting to more than 85% of the 'minority shares', to be voted in favor of the Amalgamation and to be counted as part of any minority approval required in connection with same.  As a result, McVicar is in a position to ensure the Amalgamation is approved.

About McVicar

McVicar Industries Inc., headquartered in Toronto, Canada, is focused on investments and acquisitions of businesses in China. At present, McVicar has operations in both electronic components and specialty chemicals in four operations in China.

About Jite

Jite designs and manufactures electronic and electrical connection devices for security, industrial control, automation, telecommunication, and power supply industries. JITE is headquartered in Toronto, Canada and carries out research and manufacturing operations in Shenzhen China at its ISO 9001 certified facility. For more information, visit JITE at www.jite.com.

This press release contains forward-looking statements which reflect the Corporation's current expectations regarding future events. The forward-looking statements involve risks and uncertainties. Actual results could differ materially from those projected herein. Although we believe that our expectations are based on reasonable assumptions, we can give no assurance that our expectations will materialize.

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 release.

Contact: Ms. eXavier Peterson or Dr. Gang Chai, Chief Executive Officer, Tel: [phone]; [email protected]