CALGARY, June 28, 2016 – Empire Industries Ltd. (“Empire”) (EIL: TSX-V) is pleased to announce that, further to its news release of May 18, 2016 it has successfully completed its previously announced plan of arrangement (the “Arrangement”) pursuant to which Empire spun out Empire’s hydrovac business including all of the tangible and intangible assets, employees and operations of Tornado Trucks, a division of Empire (the “Hydrovac Business”), to Tornado Global Hydrovacs Ltd. (“Tornado”).
In connection with the Arrangement, common shares of Empire will be exchanged for one quarter (1/4) of a new Empire common share and one eighth (1/8) of a new Tornado common share for every common shares of Empire currently owned. Empire has delivered a letter of transmittal to all registered shareholders to facilitate the exchange of the common shares of Empire.
With the completion of the Arrangement, the new Empire common shares will continue to trade on the TSX Venture Exchange (the “TSXV”) under the symbol “EIL”. On June 27, 2016 the TSXV conditionally approved the listing of the common shares of Tornado. Upon satisfaction of the conditions of the TSXV it is expected that the common shares of Tornado will commence trading on the TSXV under the symbol “TGH”. As a result of the Arrangement, Tornado is a reporting issuer in the Provinces of British Columbia, Alberta and Ontario.
On June 21, 2016, Empire held a special meeting of the holders of Empire common shares and options to acquire Empire common shares to consider the Arrangement. At the meeting, the Arrangement was approved by 99.81% of the holders of Empire common shares and 100% of the holders of options to acquire Empire common shares. Subsequently, on June 24, 2016, the Court of Queen’s Bench of Alberta issued a final order approving the Arrangement.
“The creation of a new public company called Tornado Global Hydrovacs Ltd. (TGH: TSX-V ) was three years in the making. Empire studied the Chinese excavation market extensively, developed an aggressive plan and found a strategic partner that committed to fund $10 million ($7.5 million of equity and $2.5 million of subordinate debt) towards leveraging Tornado’s proprietary knowledge and hydrovac truck design in China as well as continuing to manufacture and sell its unique hydrovac truck in North America. Empire determined that this opportunity was best pursued by a separate company, allowing Empire to focus its attention on its media-based attractions business. Therefore we found a strategic investor to fund this exciting initiative while allowing Empire shareholders to participate directly through their 54.5% ownership of Tornado.”
Upon listing of the Tornado common shares, it is expected that the escrow release conditions of the previously announced private placement of subscription receipts of Tornado for aggregate proceeds of approximately US $3,521,127 on January 25, 2016 and RMB 11,946,110 on February 29, 2016 will be satisfied.
Empire and Tornado will provide a further update on the application to have the Tornado common shares listed for trading on the TSXV as well as the exchange of the Tornado subscription receipts for Tornado common shares and the release of the aggregate subscription funds, when such transactions are completed.