Sep 5, 2020 6:33 AM ET
Petroteq Announces Proposed New Financing and Amendment to Securities
iCrowd Newswire -
Sep 5, 2020
Petroteq Energy Inc. an integrated oil company focused on the development and implementation of its proprietary oil-extraction and remediation technologies, announces a proposed arrangement with an existing arm’s length lender (the “Lender”) and its affiliate (the “Affiliate”). The agreement between the parties is as follows:
- the Lender will exercise existing warrants of the Company for gross proceeds to the Company of a minimum of US$61,050 which would be used by the Company to pay accrued and unpaid interest on three existing convertible debentures of the Company held by the Affiliate;
- the Lender will lend the Company US$200,000 in exchange for a US$240,000 principal amount (including an original issue discount of 20%) unsecured convertible debenture, and warrants exercisable for up to 2,000,000 common shares of the Company at US$0.10 per share for 15 months. The debenture will have a term of 15 months and bear interest at a rate of 7% per annum payable quarterly, and at the option of the Lender the purchase amount of the debenture (US$200,000) will be convertible into 2,000,000 common shares of the Company at US$0.10 per share in accordance with the terms and conditions set out in the debenture. The net proceeds of the debenture financing would be used solely by the Company to pay interest payments on existing convertible debentures of the Company held by the Lender and the Affiliate;
- the conversion price of (i) the Convertible Debenture dated November 26, 2019 issued to the Affiliate, for principal amount of US$318,000 bearing interest at 10.0% per annum and payable quarterly that matures on November 26, 2023, that had a purchase price of US$265,000 and that is convertible at US$0.17 per share, and (ii) the Convertible Debenture dated December 4, 2019 issued to the Affiliate, for principal amount of US$432,000 bearing interest at 10.0% per annum and payable quarterly that matures on December 4, 2023, that had a purchase price of US$360,000 and that is convertible at US$0.17 per share, will be amended to US$0.10; and
- the exercise price of (i) a Warrant Certificate issued by the Company to the Affiliate on November 26, 2019 exercisable for up to 1,558,730 shares of the Company at US$0.17 per share until November 26, 2023, (ii) a Warrant Certificate issued by the Company to the Affiliate on December 4, 2019 exercisable for up to 2,117,520 shares of the Company at US$0.17 per share until December 4, 2023, and (iii) a Warrant Certificate issued by the Company to the Affiliate on March 30, 2020 exercisable for up to 4,906,250 shares of the Company at US$0.15 per share until March 30, 2024, will be amended to US$0.10.
In addition, the Company also intends to complete a shares for debt transaction, pursuant to which it will issue an aggregate of 952,380 common shares in satisfaction of US$100,000 of indebtedness to a service provider. The Company determined (with the service provider’s consent) to satisfy the foregoing indebtedness with common shares in order to preserve the Company’s cash for use on its extraction technology in Asphalt Ridge, Utah, and for working capital.
The foregoing transactions are all subject to completion and execution of a definitive agreements and all necessary approvals, including from the TSX Venture Exchange (the “Exchange”). The securities issuable pursuant to the new financing and the shares for debt transactions will be issued in reliance on exemptions from the registration requirements of the United States Securities Act of 1933, as amended (the “U.S. Securities Act”), and applicable state securities laws, and will be issued as “restricted securities” (as defined in Rule 144 under the U.S. Securities Act). In addition, such securities will be subject to a Canadian four-month hold period.
The Company also announces that it has closed the US$300,000 equity financing previously announced on August 14, 2020.
About Petroteq Energy Inc.
Petroteq is a fully integrated clean technology company focused on the development and implementation of a new proprietary technology for oil extraction. The Company has an environmentally safe and sustainable technology for the extraction and reclamation of heavy and bitumen from oil sands, oil shale deposits and shallow oil deposits. Petroteq is engaged in the development and implementation of its patented environmentally friendly heavy oil processing and extraction technologies. Petroteq is currently focused on developing its oil sands resources and expanding production capacity at its Asphalt Ridge soil remediation and heavy oil extraction processing facility located near Vernal, Utah.
For more information, visit www.Petroteq.energy.
Petroteq Energy Inc.
Tel: (800) 979-1897
Petroteq Energy Inc.
Tel: (800) 979-1897