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RICHMOND, BC, Oct. 26 /CNW/ - Zongshen PEM Power Systems Inc. (the
"Company") (TSX-V: ZPP), is pleased to announce that it plans to incorporate a
new subsidiary to manufacture electric motorcycles and electric bicycles for
the Chinese domestic and international market. As gasoline-powered motorcycles
are discouraged in most major cities of China, electric motorcycles and
electric bicycles powered by rechargeable batteries are expected to be a
popular alternative for many Chinese people as a mode of transportation. The
new subsidiary will be based in Wuxi, in the Province of Jiangsu, China.
Based on preliminary market research and initial design, the Company's
management anticipates that the new subsidiary will have a capacity of
producing up to 100,000 units of electric motorcycles and electric bicycles by
the end of year 2007.
The Company plans to invest up to RMB8,000,000 (CDN$1,143,000) to fund
start up operations. The new subsidiary will be named "Jiangsu Zongshen PEM
Electric Vehicle Company Limited".
The Company is also pleased to announce that it has, subject to
regulatory approval, arranged a non-brokered private placement of a minimum of
7,500,000 and a maximum of 9,500,000 units. Each unit will consist of one
common share and one-half of one share purchase warrant, with each whole
warrant entitling the holder to acquire one additional common share at an
exercise price of CDN$0.25 per common share for a period of two years. The
private placement will result in minimum gross proceeds of CDN$1,200,000 and
the Company shall have the option to increase the size of the private
placement by up to 9,500,000 units for maximum gross proceeds of CDN$1,520,000
any time up to 48 hours prior to closing.
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