ESI Corporate Update
Victoria, British Columbia, September 8, 2010 – E.S.I. Environmental Sensors Inc. ("ESI" or the "Company"), TSX-V: ESV is pleased to announce a non-brokered private placement of up to 15,000,000 units ("Units") at $0.05 per Unit to raise gross proceeds of up to $750,000CAD. Each Unit will consist of one common share and one common share purchase warrant (a "Warrant"). Each Warrant will be exercisable into an additional common share at $0.10 for a period of one year from the closing date. The Private Placement is subject to TSX Venture Exchange ("Exchange") acceptance, and may be subject to shareholder approval.
The proceeds from this financing will be used to hire new staff in senior management and marketing, expand manufacturing to meet existing and anticipated demand for ESI's moisture monitoring, oil water-cut monitoring and associated wireless systems, and to further develop the next generation of products for the oil industry. In addition, a portion of the proceeds will be used for general working capital purposes.
Subject to Exchange approval, the Company will pay a finder's fee in connection with the private placement.
The Company is also pleased to announce that an agreement has been reached with Avis Financial Corporation ("Avis Financial") to convert a current demand loan on the Company's balance sheet into a convertible debenture. The total value of the current debt owed to Avis Financial is $1.5 million. The new debenture will be convertible into common shares at a price of $0.05 per share for a period of one year from the closing date. In addition, the debenture will bear interest at a rate of 12%. Interest is convertible into common shares at market price at the time of conversion. Full conversion of this debenture, not including interest, would result in the issuance of 30,000,000 common shares to Avis Financial; this would likely result in the creation of a new control person and a change in control of the Company. As such, this transaction is subject to shareholder approval. The Company's management and directors are not aware of any current ownership of the Company's common shares by Avis Financial. This transaction is subject to Exchange approval. Avis Financial currently own $1.34 million in outstanding ESI convertible debentures (convertible at a price of $0.35 per common share).
Any shareholder approval of the above transactions, if required, will be sought at the Company's 2010 Annual General Meeting ("AGM"), to be held at the Union Club of Victoria, located at 805 Gordon Avenue in Victoria, BC at 2:00 pm Pacific Daylight Time on September 29, 2010.
The Company also announces the granting of 1,300,000 stock options to directors and officers, and 520,000 options to employees and contractors under the Company's stock option plan. The Company's current stock option plan is a rolling 10% plan with approximately 2.1 million options available for issuance under the plan. There are no options currently issued and outstanding. The options being issued at this time will have an exercise price of $0.05 per common share and will expire after three years. Vesting of the options will occur immediately for directors and will occur over a two year period for employees and consultants. The Company will be instituting a new fixed stock option plan at its upcoming AGM that will authorize approximately 20% of the new number of issued and outstanding common shares or 7.2 million options for issuance under the plan (less any options issued in the interim). Shareholders will be asked to vote on the new stock option plan at the upcoming AGM. Other than the number of options authorized for issuance under the plan, the terms of the new fixed plan are relatively unchanged from the terms of the current rolling stock option plan previously approved by the Company's shareholders.
About Avis Financial Corporation
Avis Financial is an innovative, integrated business development engine that assists small and medium-sized enterprises (SMEs) in realizing their full potential. Involved at every step of the way, Avis Financial provides a truly comprehensive package of services to its portfolio companies, who further benefit from a high-profile brand, a major international network and extensive business expertise. Avis Financial's services include capital and operational restructuring, business development and placement preparation. To ensure that its portfolio companies receive support at every level, Avis Financial works with a large network of affiliates providing business and capital services.
About ESI
ESI is a leading manufacturer of patented and proprietary solutions for environments where understanding the presence, movement, and/or amount of water are important. Major market sectors include: Agriculture, Golf and Turf, Scientific Research, Civil Engineering and Crude Oil. ESI solutions have been successfully introduced into more than 40 countries to enable customers to optimize their operations by monitoring the presence and movement of water, managing irrigation systems, and monitoring the integrity of landfill covers. Most recently, the Flo•Point™ instrument has been introduced to the Oil industry to measure the volumetric presence of water pumped during crude oil extraction for characterization and optimization of the process. ESI differentiates itself by translating the best technology and science available into practical, easy to use solutions. Irrigation managers, Reservoir Engineers, and Scientists have adopted ESI's products for their accuracy, ease of use, repeatability, and ability to operate in challenging environments. ESI is publicly traded on the TSX Venture Exchange under the symbol "ESV". Further information about ESI may be obtained through the Company's website at www.esisensors.com.
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ESI ENVIRONMENTAL SENSORS INC. |
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