SHENZHEN, China, Feb. 1 /Xinhua-PRNewswire/ -- Irish Mag, Inc. (OTC Bulletin Board: IRHM) (proposed new name China Public Security Technology Inc.), a provider of real-time Geographic Information System ("GIS") and Software Operating Services in China, today announced the completion of the initial closing of its previously announced private placement. On January 31, 2007, the Company sold 3,934,211 shares of its common stock to two accredited investors, led by Pinnacle China Fund, L.P., for gross proceeds of approximately $7.48 million, or a price per share of $1.90. The Company expects to issue the remaining 3,934,211 shares of common stock at a second closing that will occur on or before April 30, 2007. The combined initial and second closing shares represent 19.96% of the outstanding capital stock of the Company on a fully diluted basis.
The Company will use the proceeds from the private placement for general working capital purposes, including the enhancement of the Company's software operating service, software research and development, sales channel expansion and possible acquisition opportunities.
Roth Capital Partners, LLC acted as the Company's placement agent in connection with the private placement.
Under the Securities Purchase Agreement, the Company's controlling shareholder, Mr. Jiang Huai Lin agrees to transfer to the Investors an additional 3,947,368 shares of the Company's common stock owned by him, if the after tax net income (ATNI) for the Company's 2007 fiscal year is less than $12.5 million, and another 3,947,368 shares of the Company's common stock owned by him, if either the Company's ATNI for the 2008 fiscal year is less than $21 million or the Company's earnings per share for the same period is less than $0.480 on a fully diluted basis. The company expects to achieve gross revenues of approximately $27 million and $45 million in fiscal years 2007 and 2008, respectively, to support achievement of these "make-good" net income targets.
The common stock that was sold to the investors is restricted under the Securities Act of 1933. Accordingly, the shares may not be offered or sold in the United States, except pursuant to an effective registration statement or an applicable exemption from the registration requirements of the Securities Act. The Company has agreed to file a registration statement covering the re-sale of these shares by the investors. This press release does not constitute an offer to sell or the solicitation of an offer to buy the common stock.
For more information about the securities purchase agreement and the private placement contemplated by that agreement, see the current report on Form 8-K filed by the Company on February 1, 2007.
About Irish Mag, Inc.
Through its indirect wholly-owned Chinese subsidiary, the Company is a real-time Geographic Information System (GIS) solution provider in China. The company provides a broad portfolio of fully integrated products and services, including system design and database management for Police-use GIS, Civil-use GIS, e-government and other security related products. The Company currently has an exclusive license of 16 patents in China. Through its exclusive business turnkey agreement with Shenzhen iASPEC Software Engineering Company Limited or iASPEC, under which the Company acts as iASPEC's exclusive subcontractor, the Company's key customers include Shenzhen City Public Security Bureau, China Unicom Shenzhen Division, Shenzhen Urban Planning Bureau, and the Shenzhen Fire Department. To learn more about the Company, please visit the corporate website at http://www.chinapsh.com .
Safe Harbor Statement
This press release contains certain statements that may include "forward looking statements" within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. All statements, other than statements of historical fact included herein are "forward-looking statements" including statements regarding the ability of the Company to consummate the second closing of the private placement, the company's and its subsidiaries business strategy, plans and objectives and any other statements of non-historical information. These forward looking statements are often identified by the use of forward-looking terminology such as "believes," "expects" or similar expressions, involve known and unknown risks and uncertainties. Although the company believes that the expectations reflected in these forward-looking statements are reasonable, they do involve assumptions, risks and uncertainties, and these expectations may prove to be incorrect. You should not place undue reliance on these forward-looking statements, which speak only as of the date of this press release. The Company's actual results could differ materially from those anticipated in these forward-looking statements as a result of a variety of factors, including those discussed in the Company's periodic reports that are filed with the Securities and Exchange Commission and available on its website ( http://www.sec.gov ). All forward-looking statements attributable to the Company or persons acting on its behalf are expressly qualified in their entirety by these factors. Other than as required under the securities laws, the Company does not assume a duty to update these forward-looking statements.
