Company

Andina Development Corporation Announces Letter of Intent for Reverse Takeover with Carmanah Technologies Inc.

Andina Development Corporation announces Letter of Intent for Reverse Takeover with Carmanah Technologies Inc.

Vancouver, British Columbia

Andina Development Corporation (CDNX: ADZ)

Andina Development Corporation (the "Corporation") is pleased to announce that it has entered into a letter of intent (the "Letter of Intent") dated December 22, 2000 with Carmanah Technologies Inc. ("Carmanah") and the shareholders of Carmanah. Under the Letter of Intent, the Corporation has agreed to make an offer to purchase (the "Proposed Acquisition") all of the issued and outstanding shares of Carmanah in consideration for an aggregate of 14,000,000 Post Consolidated Common Shares of the Corporation (as defined below). A deemed price of $0.36 per share is hereby reserved for the 14,000,000 shares to be issued pursuant to the Proposed Acquisition. The specific ratio of exchange between shares of Carmanah and Post Consolidated Common Shares will be determined by the parties having regard to the number of shares outstanding in Carmanah at the time of the offer.

The parties have agreed that the 14,000,000 Post Consolidated Common Shares being issued pursuant to the Proposed Acquisition shall all be subject to voluntary pooling agreements whereby a majority of the shares will be released from escrow over a six year period and the balance of the shares over a three year period. The voluntary pooling agreements will be in addition to any required statutory and regulatory escrow or hold periods. In conjunction with the Proposed Acquisition, the Corporation will be completing a brokered private placement (the "Private Placement") and a consolidation. Subject to regulatory approval, the Corporation will complete a private placement of up to 2,500,000 units ("Units") at a price of $0.75 per Unit for maximum gross proceeds of $1,875,000. Each Unit will be comprised of one post consolidated common share (a "Post Consolidated Common Share") and one-half of one common share purchase warrant ("Warrant") of the Corporation. Each whole Warrant will entitle the holder to purchase one Post Consolidated Common Share for eighteen months from the date of issuance at a price of $1.00 per share in the first twelve months and $1.25 per share thereafter to a maximum of eighteen months. Any agents participating in the Private Placement will receive a commission of 7.5% on the gross proceeds raised, and will be entitled to receive agent's options to acquire that number of Units equal to 10% of the total Units sold.

It is currently anticipated that, subject to regulatory approval, a consolidation of the Corporation's common shares will occur prior to the exchange of securities on the Proposed Acquisition and prior to the closing of the Private Placement such that every 1.5 common shares of the Corporation will be consolidated into 1 Post Consolidated Common Share.

Carmanah, a private British Columbia company incorporated in 1998, is in the business of developing and manufacturing solar-powered lighting products for marine navigation and hazard lighting and for highways hazard lighting. Carmanah currently sells its products primarily to government, industry and commercial users around the world.

Carmanah packages light-emitting diodes ("LEDs") into industrial strength solar-powered units that are completely self-contained and sealed. The company has patented the use of solar-powered LEDs in a solid state light. Carmanah's light units contain no serviceable parts, may be completely potted and can be built into permanent structures. Carmanah's capacitor light is essentially a solid material, which will produce light for up to a decade.

Management of Carmanah believes that LED technology represents one of the most fundamental improvements in lighting technology since the invention of the light bulb. LEDs produce light by a semi-conductor chip in a process that increases their life span over conventional incandescent light bulbs by at least 20 times. In addition, LEDs use far less power than incandescent bulbs and emit very little heat. Recent breakthroughs in LED technology, in the form of higher light output and wider color range, have made it possible for Carmanah to develop a range of proprietary products.

Carmanah currently has a staff of 20 and operates out of facilities in downtown Victoria, British Columbia.

Audited revenues from Carmanah's operations for the fiscal year ended December 31, 1999 totalled $1,181,287 as compared to $706,453 for the fiscal year ended December 31, 1998. Revenue from Carmanah's operations for the unaudited ten month period ended October 31, 2000 was $1,873,102.

The Proposed Acquisition of Carmanah was negotiated at arm's length between the parties and as at the date of the Letter of Intent, no directors or officers of the Corporation are also directors or officers of Carmanah.

Upon completion of the Proposed Acquisition, it is anticipated that the Corporation will have six directors, two of which will be nominated by the current management of the Corporation and three of which will be nominated by the current management of Carmanah. The remaining director will be an independent candidate nominated by the other five directors.

It is anticipated that either Carmanah or the Corporation will enter into an agreement with Varshney Capital Corp., a private company controlled by various current directors and officers of the Corporation, for the provision of advisory services to Carmanah, which, subject to regulatory approval, shall include compensation of $10,000 per month. In addition, Varshney Capital Corp. or its nominees may also receive compensation, which may include the issuance of shares, for services to be rendered in conjunction with these transactions.

A finder's fee of 100,000 Post Consolidated Common Shares will be issued in conjunction with the Proposed Acquisition to arm's length parties, subject to regulatory approval and applicable prospectus exemptions.

The Corporation also intends to adopt a stock option plan permitting the grant of incentive stock options equal to 20% of the issued and outstanding Post Consolidated Common Shares. A price of $0.75 per share is hereby reserved for any grant of stock options on or around the closing of the Proposed Acquisition.

Upon signing the Letter of Intent, as negotiated by the parties, the Corporation advanced an aggregate of $200,000 to Caramanah and on January 31, 2001, a further $200,000 was advanced. On February 15, 2001, an additional $100,000 was loaned to Carmanah bringing the total in advances to $500,000. All advances are secured in favour of the Corporation pursuant to a general security agreement. Upon agreement by the parties, up to an additional $250,000 may be loaned to Carmanah (for aggregate advances of $750,000) prior to completion of the Proposed Acquisition.

The Proposed Acquisition of the outstanding shares of Carmanah and the issuance by the Corporation of Post Consolidated Common Shares in consideration thereof will constitute a reverse takeover under the policies of the Canadian Venture Exchange and as a result, is subject to both shareholder and regulatory approval. Upon completion of the Proposed Acquisition, the Corporation intends to continue business as an industrial company. As part of the regulatory approval process, the Corporation anticipates convening an annual general and special meeting of shareholders as soon as practicable.

Research Capital Corporation, subject to completion of satisfactory due diligence, has agreed to act as sponsor to the Corporation in connection with the transaction and will be paid a sponsorship fee therefore. An agreement to sponsor should not be construed as any assurance with respect to the merits of the transaction or the likelihood of completion. Research Capital Corporation will act as agent for a portion of the Private Placement described above. Canaccord Capital Corporation will also participate in the Private Placement.

Completion of the above transaction is subject to a number of conditions, including but not limited to, acceptance of the Canadian Venture Exchange and disinterested shareholder approval. 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 management information circular of the Corporation to be prepared in connection with this transaction, any information released or received with respect to the reverse takeover may not be accurate or complete and should not be relied upon. Trading in the securities of Andina Development Corporation should be considered highly speculative.

The Canadian Venture Exchange has in no way passed upon the merits of the proposed transaction and has neither approved nor disapproved the contents of this press release.

For further information, please contact:

Investor Relations

Andina Development Corporation

1304-925 West Georgia Street

Vancouver, British Columbia, Canada  V6C 3L2

Telephone: (604) 684-2181