Cantronic Systems Inc.

Cantronic Systems Inc.

December 09, 2009 08:00 ET

Cantronic Systems Inc. Announces Closing of $2.3 Million in Unsecured Debentures

VANCOUVER, BRITISH COLUMBIA--(Marketwire - Dec. 9, 2009) -


Cantronic Systems Inc. (TSX VENTURE:CTS) (the "Company") is pleased to announce that further to its previous announcement dated November 17, 2009, the Company has completed its closing for $2,299,000 in unsecured convertible debentures (the "Debentures") . The Debentures will mature on December 15, 2014 and will bear interest at 10% per annum, payable semi-annually. The Debentures are convertible as to principal, in whole or in part, at the option of the Debenture holder, into common shares in the capital of the Company (the "Shares") at $0.40 per Share. Upon maturity, the Company may repay the Debentures in cash, or at its option, in Shares by issuing that number of Shares obtained by dividing the amount payable by 95% of the volume weighted average trading price of the Shares on the TSX Venture Exchange (the "Exchange") for the 20 consecutive trading days ending five days before the maturity date (the "VWAP"), provided that such VWAP shall not be less than the discounted market price (as defined by the Exchange) on the maturity date. After December 15, 2011, the Company has the right, under certain circumstances, to redeem the Debentures in whole or in part. The Debentures will be subject to a 4 month hold period expiring April 8, 2010 in accordance with Canadian securities laws and the rules of the Exchange.

Versant Partners Inc. and Loewen, Ondaatje, McCutcheon Limited (collectively, the "Agents") acted as agents in connection with the private placement and will receive a cash commission equal to 7% of the gross proceeds and broker warrants exercisable for 402,325 Shares expiring 24 months from closing. The Company will pay an additional 1% cash commission and 1% broker warrants to the selling group.

The majority of net proceeds will be used for working capital- to increase sales in China, with the balance for general working capital and corporate purposes.

These securities have not been and will not be registered under the United States Securities Act of 1933, as amended (the "U.S. Securities Act") and may not be offered or sold in the United States or to a U.S. persons (as defined in Regulation S under the U.S. Securities Act) absent registration or an applicable exemption from registration requirements.

About Cantronic Systems Inc.

Cantronic Systems Inc. manufactures, distributes, and provides training and services in the fields of infrared vision and video security surveillance technologies, specializing in passive and active infrared cameras, infrared illuminators, low light infrared sensitive CCD cameras and long-range night vision surveillance systems for demanding homeland security and surveillance application.

Cantronic holds a valid medical device manufacturing license and is a manufacturer and distributor of its fever scan thermal imaging camera systems which has been widely deployed in public facilities such as airports, railway stations, and border crossings worldwide during the SARS (Avian/Bird Flu) outbreak in 2003 as well as during the Swine (H1N1) Flu pandemic in 2009.

Cantronic, through its US subsidiary QWIP Technologies, Inc. ("QWIPTECH"), holds a worldwide, exclusive license from the California Institute of Technology ("Caltech") to produce and sell infrared detectors and sensors based on Caltech's Quantum Well Infrared Photodetector technology.

Cantronic, through its China subsidiaries Cantronic Security Systems (China) Co. Ltd., Beijing Advanced Videoinfo Technology Co. Ltd. ("AVINFO") and Shenzhen Huanghe Digital Technology Co. Ltd. ("Yellow River"), provides digital networked video surveillance solutions to government and corporate customers in China.

Cantronic is a Tier 1 issuer on the TSX-V exchange, trading under the symbol CTS. For further information about Cantronic and QWIPTECH, please visit our websites at and

Safe Harbor Statement

The Securities offered have not been registered under the U.S. Securities Act of 1933, as amended, and may not be offered or sold in the United States absent registration or an applicable exemption from the registration requirements. This press release shall not constitute an offer to sell or the solicitation of an offer to buy nor shall there be any sale of the securities in any State in which such offer, solicitation or sale would be unlawful.

Forward-looking statements contained in this press release involves known and unknown risks, uncertainties and other factors that may cause actual results, performance and achievements of Cantronic to be materially different from any future results, performance or achievements expressed or implied by the said forward-looking statements.

TSX Venture Exchange does not accept responsibility for the adequacy or accuracy of the contents of this news release.

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