CO2 GRO Inc (TSX-V:GROW, OTCQB:BLONF) told investors it plans to complete a non-brokered private placement of unsecured convertible debentures for a principal amount of up to $2.5 million.
The debentures will carry a 13.5% annual interest rate over a three-year term. During the first year, quarterly interest payments will be made in cash, while in the following two years, the company can opt for cash payments or issue common shares for interest payments. Holders can convert the debentures into units at $0.12 per unit, each comprising one common share and one common share purchase warrant. The warrants allow the holder to acquire a common share at $0.15 per share for 48 months.
The company holds the option to force a conversion if the average closing price of common shares exceeds $0.20 for 20 consecutive trading days.
Net proceeds are expected to fund working capital, pipeline development, and the conversion of Technology Adaptation Projects (TAPs) into recurring revenue. The funds will also support hiring additional engineering and technical staff.
The offering, likely to close in tranches starting around December 18, 2023, is subject to regulatory approval.
Contact the author at stephen.gunnion@proactiveinvestors.com