WINNIPEG, Thursday, December 8, 2011 – Empire Industries Ltd. (“Empire” or the “Company”) (TSX-V: EIL) today announced it has closed a private placement of Units for aggregate gross proceeds of $1 million. The proceeds from the financing will be used for working capital purposes for Empire’s North American activities.
The Company issued a total of 20,000,000 Units at a price of $0.05 per Unit with each Unit consisting of one (1) Common Share in the capital of the Company (“Common Share”) and one half (1/2) of a Common Share Purchase Warrant (“Warrant”). Each whole Warrant entitles the holder to purchase one (1) Common Share of the Company at an exercise price of $0.10 until expiry on December 8, 2013. The Common Shares, Warrants and Common Shares issuable upon exercise of the Warrants are subject to a four month hold period.
The private placement has been fully subscribed for by Insiders. The primary subscriber was Qi Guang Investments (HK) Ltd., controlled by Mr. Qiguang Qiu. Mr. Qiu’s $800,000 investment in this private placement is in addition to the $450,000 investment he made earlier in 2011, and the $711,000 he has loaned to the Company on a limited recourse basis to fund the Company’s 45% equity ownership interest in Dongguan Qiguang Dynamic Steel Structures, Ltd. This Chinese corporation is 55% owned by a company controlled by Mr. Qiu. It operates out of a new, 75,000 square foot shop in Dongguan, China, with opportunities for expansion.
Contemporaneously with the closing of the private placement, the Board of Directors appointed Chao Jian (Jane) Lin to the Board of Directors. Jane is a Canadian citizen who was born and raised in China. She has degrees from Guangzhou University and the University of British Columbia. Her knowledge of the Chinese market and culture is expected to provide an invaluable contribution to Empire’s Board.