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.
About Zongshen PEM Power Systems
Inc.
Zongshen PEM Power Systems Inc. is
a Canadian company engaged in research, development and commercialization
of small to medium range, low cost, high performance fuel cell systems
as well as related membrane electrode assembly (MEA) technologies.
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