Canada announces private placement offering and closes first tranche of C$1 million

May 7, 2019 |

In Canada, Cielo announced a private placement offering of a targeted minimum of C$1 million in convertible debentures units. Each unit will consist of one $1,000 unsecured convertible debenture and 500 share purchase warrants.

The Debentures will bear interest at a simple rate of 15% per annum, the initial two = years of interest to be prepaid on the date of issuance of the Debentures by the issuance of common shares at a price of C$0.10 per Prepaid Interest Share. The principal of the Debentures together with all accrued interest exceeding the Prepaid Interest will be repaid 48 months from the Issue Date unless repaid earlier by Cielo without penalty or converted by the holder(s) thereof any time after four months and a day following the Issue Date at a price of C$0.06 for the Principal and C$0.10 for the Interest Balance.

Each Warrant will be exercisable for a term of 48 months from the Issue Date at an exercise price of C$0.25 per share, subject to acceleration in the event that the common shares of Cielo listed on a recognized stock exchange trade at C$0.50 or higher for at least five consecutive trading days, in which event Cielo may provide a notice to holders that the Warrant Term will terminate 30 days from the date of notice.

Cielo announced that it has closed the first tranche of the Offering exceeding its minimum target. Cielo has raised gross proceeds of C$1,008,000 by the issuance of 1,008 Units (including C$50,000 of debt owing to one contractor converted to 5 Units). In addition to the issuance of the Units, 3,024,000 Prepaid Interest Shares were issued. The Offering is expected to remain open until May 24 to allow for current interested parties to participate in the Offering but may close sooner or later in the discretion of the Company, subject to CSE approval.

Net proceeds of the Offering will be used towards the costs of completing the new construction required to be completed to the Company’s refinery in Aldersyde, Alberta, as well as for general working capital.

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