Improved outlook for Tornado Global Hydrovacs results in opportunity for Empire to convert its debt to equity
TORONTO, August 4, 2017 – Empire Industries Ltd. (“Empire” or the “Company”) (TSX-V: EIL) is pleased to announce that it intends to convert the debt owed to it by Tornado Global Hydrovacs Ltd. (“Tornado”) (TSX-V:TGH) into 30,185,544 common shares of Tornado.
Shares for Debt Transaction
As background, Empire provided Tornado with a secured term loan (the “Loan”) as part of the spin-out transaction that Empire completed in 2016 which created Tornado. The Loan carries an interest rate of 2.7% per annum. Tornado and Empire have agreed that the Loan plus accrued interest totaling CDN $2,716,699 as of August 1, 2017 will be converted into 30,185,544 common shares of Tornado at a price of $0.09 per Common Share (the “Shares for Debt Transaction”). The Shares for Debt Transaction is subject to the following conditions: (i) the concurrent closing of a Private Placement to be completed by Tornado; and (ii) the receipt of all necessary regulatory approvals by Tornado. Empire and Tornado intend to close the Shares for Debt Transaction on or before September 15, 2017. The Common Shares issued to Empire pursuant to the Shares for Debt Transaction will be subject to a four month and one day hold period.
The Shares for Debt Transaction is one piece of a financing arrangement Tornado intends to complete which also includes a rights offering, a common share private placement, and a unit private placement (the “Financing Arrangement”). It is intended that all common shares issued pursuant to the Financing Arrangement and the Shares for Debt Transaction will be issued at $0.09 per common share, subject to the policies of the TSX Venture Exchange. A full description of the Financing Arrangement is contained in a press release issued by Tornado on August 1, 2017, which is available for viewing on Tornado’s Sedar profile: www.sedar.com or Tornado’s web-site: www.tghl.ca.
About Tornado Global Hydrovacs Ltd.
Tornado designs and manufactures hydrovac trucks in Canada and sells hydrovac trucks for excavation service providers to the oil and gas industry and the municipal markets in Canada and the USA. Hydrovac trucks use high pressure water to pulverize soil and turn it into mud, and then vacuum up the resulting mud into its tank. Tornado currently operates in North America. Tornado intends to expand its hydrovac business into China and has established a wholly owned operation in China with a head office in Beijing.
For more information about Tornado, visit www.tghl.ca or contact:
Chief Executive Officer
+1 (403) 204-6333
About Empire Industries Ltd.
Empire focuses on designing, supplying, and installing premium theme park, media-based attractions and ride systems for the global entertainment industry. Empire also uses these same turn-key integration services for special projects such as large optical telescopes and enclosures. Through Empire’s execution of its strategy over the years, Empire owns several non-entertainment investments that it seeks to optimize and liquidate at the appropriate time. Empire’s equity holding in Tornado falls into this category. Empire’s common shares are listed on the TSX Venture Exchange under the symbol EIL.
For more information about Empire, visit www.empind.com or contact:
Chief Executive Officer
+1 (416) 366-7977
Vice President – Corporate Affairs and Administration
+1 (204) 589-9301
This news release contains forward-looking statements, within the meaning of applicable securities legislation, concerning Empire’s business and affairs. In certain cases, forward-looking statements can be identified by the use of words such as ‘‘plans’’, ‘‘expects’’ or ‘‘does not expect’’, ‘‘budget’’, ‘‘scheduled’’, ‘‘estimates’’, “forecasts’’, ‘‘intends’’, ‘‘anticipates’’ or variations of such words and phrases or state that certain actions, events or results ‘‘may’’, ‘‘could’’, ‘‘would’’, ‘‘might’’ or ‘‘will be taken’’, ‘‘occur’’ or ‘‘be achieved’’. These forward looking statements are based on current expectations, and are naturally subject to uncertainty and changes in circumstances that may cause actual results to differ materially. Readers are cautioned not to place undue reliance on such forward-looking statements. Forward-looking information is provided as of the date of this press release, and Empire assumes no obligation to update or revise them to reflect new events or circumstances, except as may be required under applicable securities laws. 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.