Empire Industries Announces Closing of Second Subscription Receipt Private Placement by Affiliate

CALGARY, ALBERTA--(Marketwired - March 1, 2016) - Empire Industries Ltd. ("Empire") (TSX VENTURE:EIL) is pleased to announce that, further to its news release dated February 1, 2016, the wholly-owned subsidiary of Empire, Tornado Global Hydrovacs Inc. ("Tornado"), has closed a second private placement of subscription receipts for aggregate gross proceeds of RMB 11,946,110 (approximately $2,500,000) (the "Second Subscription Receipt Private Placement"). As more particularly described in the February 1, 2016 news release, Empire proposes to spin-out its hydrovac business including all of the tangible and intangible assets, employees and operations to Tornado pursuant to a court approved plan or arrangement (the "Arrangement"). In contemplation of the Arrangement, Tornado previously closed a subscription receipt private placement for aggregate gross proceeds of approximately $5,000,000 (the "First Subscription Receipt Private Placement"). In the event that the Arrangement is completed, the aggregate gross proceeds of both of the subscription receipt private placements will be used as working capital of Tornado and a wholly-owned subsidiary of Tornado to be organized in China (the "WFOE") to carry on the hydrovac business of Tornado in China.

Tornado has completed the Second Subscription Receipt Private Placement with Excellence Raise Overseas Limited (the "Subscriber"), the subscriber in the First Subscription Receipt Private Placement. The subscription receipts issued under the Second Subscription Receipt Private Placement have been subscribed for by the Subscriber pursuant to the terms of a subscription receipt subscription agreement (the "Subscription Agreement") entered into by the Subscriber, Empire, Tornado and Everbright Law Firm, a law firm in Shanghai, China, as escrow agent dated February 29, 2016. The closing of the Second Subscription Receipt Private Placement resulted in the issuance of subscription receipts which entitle the Subscriber to receive, without payment of additional consideration or further action, such number of shares in the capital of Tornado ("Tornado Shares") as shall equal no less than 15.17% of the issued and outstanding Tornado Shares immediately following the completion of the Arrangement for gross proceeds of RMB 11,946,110 (approximately $2,500,000). The proceeds of the Second Subscription Receipt Private Placement will be released to Tornado upon satisfaction of the same escrow release conditions as in the First Subscription Receipt Private Placement which include: (i) the approval of the Arrangement by the holders of Empire's common shares; (ii) the listing of the Tornado Shares on the TSX Venture Exchange (the "Exchange"); (iii) the receipt of the final order of the Court of Queen's Bench of Alberta approving the Arrangement; and (iv) the closing of the Arrangement.

Assuming the Arrangement is completed and the subscription receipts held by the Subscriber are exchanged for Tornado Shares, the Subscriber will become a "control person" (as such term is defined under the policies of the Exchange) of Tornado, holding 45.5% of the issued and outstanding Tornado Shares. Shareholders of Empire will hold 54.5% of the Tornado Shares. The Arrangement will be an arm's length transaction under the policies of the Exchange.

The Arrangement, the First Subscription Receipt Private Placement and the Second Subscription Receipt Private Placement and all the securities transactions associated therewith or arising therefrom shall be subject to all applicable rules, policies and regulations of securities regulatory authorities (including applicable stock exchange and shareholder approvals) and securities and corporate laws.

All references to currency in this news release are to Canadian Dollars unless otherwise specified.

About Empire Industries Ltd.

Empire Industries Ltd. manufactures specialized engineered products and sells these products domestically and in select international export markets. The company develops, designs and engineers products for the rapidly growing, global, media based attractions market and also uses these globally competitive competencies in the optical telescope market. The company designs and manufactures Hydrovac trucks for excavation service providers to the oil and gas industry and the municipal markets. The company provides steel fabrication & installation services, primarily to the industrial, commercial and infrastructure market in Western Canada. The company has two key strategic equity partnerships; a 49% ownership of ACE Industrial Services that operates in the oil sands industrial maintenance services market, and a 45% ownership of a Chinese joint venture company in the steel fabrication market in Asia. Empire's common shares are listed on the TSX Venture Exchange under the symbol EIL.

Advisory

The Exchange has in no way passed upon the merits of the proposed transaction and has neither approved nor disapproved the contents of this press release.

Neither the Exchange nor its Regulation Service Provider (as that term is defined in policies of the Exchange) accepts responsibility for the adequacy or accuracy of this news release

Certain statements contained in this news release constitute forward-looking statements. These statements relate to future events. All statements other than statements of historical fact are forward-looking statements. The use of the words "may", "expected", "believes", "anticipates" and other words of a similar nature are intended to identify forward-looking statements. These statements involve known and unknown risks, uncertainties and other factors that may cause actual results or events to differ materially from those anticipated in such forward-looking statements. Although Empire believes these statements to be reasonable, no assurance can be given that these expectations will prove to be correct and such forward-looking statements included in this news release should not be unduly relied upon. Such statements include statements with respect to the completion of the Arrangement and any transactions associated therewith, the organization of the WFOE, and the receipt of any regulatory, shareholder or other approvals required in connection with any transactions described herein. There is no assurance that the parties will complete the Arrangement or any related transactions. Actual results could differ materially from those anticipated in these forward-looking statements as a result of prevailing economic conditions, receipt of requisite regulatory approvals, and other factors, many of which are beyond the control of Empire. The forward-looking statements contained in this news release represent Empire's expectations as of the date hereof, and are subject to change after such date. Empire disclaims any intention or obligation to update or revise any forward-looking statements whether as a result of new information, future events or otherwise, except as may be required by applicable securities regulations.