Echelon Capital Corporation Announces Proposed Qualifying Transaction

TORONTO, ONTARIO--(Marketwire - March 5, 2010) -

(NOT FOR DISSEMINATION IN THE UNITED STATES OF AMERICA)

Echelon Capital Corporation ("Echelon") (TSX VENTURE:ECO.P), a capital pool company, is pleased to announce that it has entered into a letter agreement to complete a business combination (the "Qualifying Transaction") with Congo Mineral Resources Sprl ("CMR"). If completed, the Qualifying Transaction will constitute Echelon's Qualifying Transaction pursuant to the policies of the TSX Venture Exchange (the "Exchange").

Information Concerning Echelon

Echelon is a company existing under the laws of Ontario and is a reporting issuer in British Columbia, Alberta and Ontario. Echelon currently has 2,360,000 common shares ("Echelon Shares") outstanding, of which 1,160,000 are currently held in escrow pursuant to the policies of the Exchange.

Echelon has granted stock options to acquire up to an aggregate of 188,800 Echelon Shares at a price of $0.25 per share (the "Echelon Options") to directors and officers. Other than these Echelon Shares and Echelon Options, no other securities of Echelon are outstanding.

Further information concerning Echelon can be found in the prospectus of Echelon dated June 14, 2007, which is available on SEDAR at www.sedar.com.

Information Concerning Congo Mineral Resources Sprl

CMR is a private company existing under the laws of the Democratic Republic of the Congo ("DRC") which was incorporated on March 21, 2006. CMR currently has 867,421 shares ("CMR Shares") outstanding. In addition, CMR has granted stock options to acquire up to an aggregate of 104,090 CMR Shares at a price of $1.00 per share (the "CMR Options") to directors and officers. Other than these CMR Shares and CMR Options, no other securities of CMR are outstanding.

CMR holds a portfolio of greenfield mineral exploration properties in the DRCincluding a 100% interest in three contiguous copper exploration permits covering approximately 1,080 km2 in the Kasenga region of the province of Katanga, DRC. The Kasenga permits are located in the Lufilian foreland, a triangular-shaped area located in the southeast of Katanga Province and to the north of the Lufilian arc, which hosts several major world-class copper and cobalt deposits. The Lufilian foreland and Lufilian arc are hosted by the Katangan Sequence and together form one of the largest metallogenic districts in the world.

Although the Lufilian arc has been actively explored, only two companies (Anvil Mining Ltd. and Mawson West Resources Ltd.) have explored the Lufilian foreland in recent times. In 2004, Anvil Mining reported that it conducted diamond drilling in the Lufukwe Anticline (located 40 kilometers north of CMR's Kasenga permits), an elongated anticlinal fold composed mainly of Roan sediments in the core overlain by the sediments of the Nguba Group and the lower two Subgroups of the Kundelungu Group (i.e. Kalule and Kiubo Subgroups). The Anvil Mining drilling confirmed the presence of stratabound chalcopyrite mineralisation extending for a strike length of at least 1,500 metres with oxide copper mineralisation comprising malachite with lesser chrysocolla and cuprite along with native copper visible at surface. Anvil Mining reported preliminary grades in the order of 1% to 2% copper (Anvil Mining 2004 Annual Report).

While located approximately 210 kilometres northeast of the Kasanga properties, Mawson West Resources' Kapulo property confirms the presence of significant copper mineralization within the Lufilian foreland. Mawson West Resources reports three high grade copper deposits which are part of a series of north-south oriented copper silver occurrences traceable over a length of more than 50 kilometres. The most recent historical resource estimates (Bornuat, 1974) were estimated at about 1.12Mt of ore grading 4.73% copper (using a 1% copper cut-off grade). The spatial extent of the deposits is not precisely constrained.

Given the exploration potential of the Kasenga permits, they shall serve as the qualifying property for a National Instrument 43-101 compliant technical report that will be prepared by MSA Geoservices (Pty) Ltd., and submitted for Exchange approval in connection with the Qualifying Transaction.

In addition to the Kasenga permits, the following properties are also a part of CMR's portfolio:

--  a 100% interest in a series of contiguous tin/gold exploration permits
    in the Kongolo region of Katanga, DRC upon which it has assigned an
    option to purchase to an established DRC-based exploration company. 
--  CMR is in the process of completing the transfer of title of four
    limestone exploitation permits located in the Mbanza-Ngungu are of Bas
    Congo province, DRC. These properties are located close to existing
    infrastructure and adjacent to currently producing properties. 
--  CMR is in the process of completing the transfer of title of 11
    bitumen/tar sands exploitation permits located in the Moanda region of
    Bas Congo province, DRC. 

The CMR Shares are principally held by Rashid and Imran Patel, residents of the DRC and Canada respectively who jointly hold approximately 8% of the outstanding CMR Shares, and by John Eckert, Moez Kassam, John McBride, Niral Merchant and Loudon Owen, residents of Canada, each of whom owns approximately 8% of the outstanding CMR Shares. The remaining CMR Shares are held by approximately nineteen individuals who are investors or advisors to CMR.

Financial information for CMR will be provided in the management information circular of Echelon to be prepared in connection with the Qualifying Transaction.

Information Concerning the Proposed Qualifying Transaction

Echelon and CMR have entered into a letter agreement dated March 5, 2010 (the "Letter Agreement") setting out certain terms and conditions pursuant to which the proposed Qualifying Transaction will be completed. The Qualifying Transaction is subject to the parties successfully negotiating and entering into a definitive share exchange agreement or other similar agreement such that the Qualifying Transaction may be completed on a tax preferred basis to the parties thereto.

Prior to the completion of the Qualifying Transaction, CMR intends to complete a reorganization to transfer the ownership of CMR to a British Virgin Islands incorporated company (the "Target"). Pursuant to the reorganization, CMR will become a wholly-owned subsidiary of the Target and the holders of the CMR Shares will be issued shares in the Target.

Pursuant to the Letter Agreement, Echelon has agreed to issue 6,818,182 Echelon Shares to the current shareholders of CMR at a deemed value of $0.22 per share in consideration for the acquisition of all of the shares of the Target. Echelon has also agreed to issue stock options to acquire 818,178 Echelon Shares at a price of $0.13 per share to the current holders of the CMR Options in exchange for the CMR Options. The Echelon Shares issuable under the transaction will be subject to the escrow requirements of the Exchange and hold periods as required by applicable securities laws.

Prior to the completion of the Qualifying Transaction, Echelon will undertake a non-brokered private placement of up to 4,545,455 units at a price of $0.22 per unit for gross proceeds of up to $1,000,000 (the "Concurrent Financing"). Each unit will consist of one Echelon Share and one-half of one common share purchase warrant of Echelon. Each whole warrant will entitle the holder thereof to acquire one Echelon Share at an exercise price of $0.35 per share for a period of 18 months. The Concurrent Financing will close concurrently with, and will be conditional upon, completion of the Qualifying Transaction. The proceeds of the Concurrent Financing will be used for the recommended work program on CMR's Kasenga permits and working capital purposes and will be required for the resulting issuer to meet the Exchange's minimum listing requirements. Finder's fees may be paid in connection with the Concurrent Financing in amounts to be determined and in accordance with the policies of the Exchange.

Assuming the completion of the Qualifying Transaction, current Echelon shareholders, current CMR shareholders and investors under the Concurrent Financing would hold approximately 17.2%, 49.7% and 33.1% of the then outstanding Echelon Shares (or shares of the resulting issuer), respectively.

The completion of the Qualifying Transaction is subject to the approval of the Exchange and all other necessary regulatory approvals. It is also subject to additional conditions precedent, including shareholder approvals of Echelon and CMR as required under applicable corporate or securities laws, satisfactory completion of due diligence reviews by both parties, approvals of the boards of directors of Echelon and CMR and certain other conditions customary for transactions of this nature.

As noted above, each of John Eckert, John McBride and Loudon Owen are shareholders of CMR (each holding 73,160, or 8.4%, of the outstanding CMR Shares). Messrs. Eckert, McBride and Owen are all directors and shareholders of Echelon (each holding 40,000, or 1.7%, of the outstanding Echelon Shares), and Mr. Eckert is President, Chief Executive Officer and Chief Financial Officer of Echelon. In addition, Messrs. Eckert and Owen own all of the shares of McLean Watson Capital Inc., which owns 1,000,000, or 42.4%, of the outstanding Echelon Shares. Accordingly, non-arm's length parties own an aggregate of 219,400, or 25.2%, of the outstanding CMR Shares and an aggregate of 1,120,000, or 47.5%, of the outstanding Echelon Shares. As a result, the Qualifying Transaction will be a Non-Arm's Length Transaction (as that term is defined in the policies of the Exchange) and shareholder approval of the Qualifying Transaction, including majority of the minority approval, will be required. As a related party transaction, the Qualifying Transaction is also subject to the requirements of Multilateral Instrument 61-101, but it is exempt from the formal valuation and majority of the minority approval requirements of that Instrument.

Trading in the Echelon Shares will remain halted pending the review of the proposed Qualifying Transaction by the Exchange. There can be no assurance that trading in the Echelon Shares will resume prior to the completion of the Qualifying Transaction.

Management and Board of Directors of Resulting Issuer

Upon completion of the Qualifying Transaction, it is anticipated that management of the resulting issuer will consist of the persons identified below.

Imran Patel - President, Chief Executive Officer and Director

Mr. Patel is currently the Managing Director of CMR, of which he is a co-founder. He also acts as advisor to a North American equity fund. The fund has invested in a number of junior and development-stage mining, technology, and industrial companies via public market and private transactions. Mr. Patel has assisted development-stage companies in the Democratic Republic of Congo and sub-Saharan Africa in need of financing and operational expertise in various capacities including market development, strategic, and financial issues. These companies are involved in aviation and airline services, retail, marketing, and agriculture. His experience in the financial sector, specifically in regards to mining investment, combined with his knowledge of the business sector in the DRC, allow him to understand the unique challenges that face mining companies operating in the country. Mr. Patel holds a B. Comm. from the University of Toronto.

Tom Pladsen - Chief Financial Officer and Director

Mr. Pladsen has extensive experience in corporate financing and financial reporting for public and private companies. Mr. Pladsen received his Chartered Accountant designation with KPMG LLP in Toronto in the mid 1980's and has since held various financial positions with TSX listed, TSXV listed and private mining and technology companies. These positions included CEO of Katanga Mining Limited (resource company) from February 2004 to November 2005, CFO of Katanga from February 2004 to June 2006, CFO of Andina Minerals Inc. (resource company) from January 2005 to June 2009 and CFO of Merc International Minerals Inc. (resource company) from December 2008 to the present, as well as consulting work for several TSXV listed junior mining companies. All of these companies continue to carry on the same business. Mr. Pladsen holds a BBA from Wilfrid Laurier University, is a director of Merc International Minerals Inc. (TSXV listed resource company), Northfield Capital Corporation (TSXV listed merchant banking company), Hosted Data Transaction Solutions Inc. (TSX listed technology company), White Pine Resources Inc. (TSXV listed resource company), Anaconda Mining Inc. (TSX listed resource company) and Brionor Resources Inc. (TSXV listed resource company).

Carl Hansen - Director

Mr. Hansen is currently the President and CEO of Atacama Pacific Gold Corporation, a private company with exploration activities in Chile. In December 2003, Mr. Hansen co-founded and was President and CEO of Andina Minerals Inc., a public company listed on the TSX Venture Exchange, from 2003 through January 2009. A geologist with over 20 years of international experience in the exploration and mining industry, his career has encompassed various exploration, operational and head office positions with both junior exploration and senior mining companies including INCO, TVX Gold, and Kinross. He is also a director of Solfotara Mining Corporation and a number of private resource and technology companies. Mr. Hansen graduated with a BSc (Hon) from Laurentian University, Sudbury, Ontario.

Loudon Owen - Director

Loudon Owen is co-founder and a Managing Partner of McLean Watson Capital Inc. McLean Watson is one of Canada's pre-eminent venture capital firms. It invests in leading technology companies and currently has $200 million (Cdn.) under management. Mr. Owen was previously Co-Chief Operating Officer of Softimage Inc., a Nasdaq-listed software corporation that was sold to Microsoft Inc. He is a lawyer with extensive corporate and securities law experience, concentrating on technology companies. Mr. Owen is Honorary Chairman and Past President of the Canadian INSEAD Alumni Association. He is a member of the Board of Governors of Upper Canada College. He is on the Board of Directors of many private companies and has also been on the Board of several substantial public companies. Mr. Owen holds a BA from the University of Toronto, an LLB from Osgoode Hall Law School and an MBA from INSEAD (France).

Rashid Patel - Director

Mr. Patel has been based in the DRC for more than 40 years. Throughout this period, he has been active in a variety of businesses including the import and export of fast-moving consumer goods (FMCGs) and electronics, manufacturing of electronics and three-wheel scooters, plastics - injection moulding, and aviation and airline services. He is also a member of the Board of Directors for the Federation d'Entreprises Congolaises (FEC, the DRC Chamber of Commerce), where he holds the titles of President of the National Commission of Transport and Coordinator to the National Commission of Mines. He also represents FEC at the Association of Southern African Chambers of Commerce and Industries (ASCCI), an organization that oversees Chambers of Commerce in 15 Southern African countries. In addition, Mr. Patel is the Vice President of the Chambers of Commerce and Industry South Africa-Congo, and the Founding President of the India-Congo Chamber of Commerce, Industry, Trade, Mining, Agriculture and Services (ICCITIMAS). Through his active involvement in local and regional business development initiatives, Mr. Patel has built a vast network of contacts spanning not only state-owned companies and agencies, but the government, private sector, diplomatic missions, and NGOs.

Moez Kassam - Director

Mr. Kassam is a Portfolio Manager for Anson Funds in Toronto. His primary responsibilities are to oversee all trading and portfolio strategy. Prior to joining Anson, Moez managed closely held money, with portfolio sizes ranging from USD $1.5 million to $6.0 million. In addition, Moez serves as a director of The Midas Safety Group, a Global safety equipment manufacturer and Special Advisor to Enviromena Power Systems, a leading developer of solar projects in the Middle East and North Africa. Moez routinely advises senior management on financial matters such as structuring financing tools, devising compensation strategies, and ongoing capital management. Moez earned a BA from the University of Western Ontario in 2002 and is slated to complete his Executive MBA at London Business School at the University of London, UK in early 2010.

Sponsor

The proposed Qualifying Transaction is subject to the sponsorship requirements of the Exchange. The parties intend to apply for an exemption from the sponsorship requirements of the Exchange. In the event that an exemption is not available, a sponsor will be identified at a later date and will be announced in a subsequent press release of Echelon. An agreement to sponsor should not be construed as an assurance with respect to the merits of the transaction or the likelihood of completion of the proposed Qualifying Transaction.

As noted above, completion of the Qualifying Transaction is subject to a number of conditions, including, but not limited to, acceptance by the Exchange. The Qualifying Transaction cannot close until the required approvals have been obtained. There can be no assurance that the Qualifying Transaction will be completed as proposed or at all.

Investors are cautioned that, except as disclosed in the filing statement or management information circular of Echelon to be prepared in connection with the proposed Qualifying Transaction, any information released or received with respect to the proposed Qualifying Transaction may not be accurate or complete and should not be relied upon. Trading in the securities of Echelon should be considered to be highly speculative.

This press release contains projections and forward-looking information that involve various risks and uncertainties regarding future events. Such forward-looking information can include without limitation statements based on current expectations involving a number of risks and uncertainties and are not guarantees of future performance of Echelon or CMR. These risks and uncertainties could cause actual results and Echelon or CMR's plans and objectives to differ materially from those expressed in the forward-looking information. Actual results and future events could differ materially from those anticipated in such information. These and all subsequent written and oral forward-looking information are based on estimates and opinions of management on the dates they are made and expressly qualified in their entirety by this notice. Echelon assumes no obligation to update forward-looking information should circumstances or management's estimates or opinions change.