Forward Water Technologies Corp (TSX-V:FWTC) said it and Fraser Mackenzie Accelerator (FMAC) are advancing towards completing a qualifying transaction on the TSX Venture Exchange, with FMAC providing financial support through loans and a concurrent financing plan.
In a statement, Forward Water Technologies (FWTC) said FMAC has provided an additional secured loan of $25,000.
The FMAC loan to FWTC has the same level of security and priority as other loans previously advanced by FWTC's existing shareholders, including FirstLine Venture Partners Corporation and Sustainable Chemistry Alliance.
The new FMAC loan will mature on December 31, 2024, and will accrue interest at an annual rate of 20%, starting 120 days after the execution of the definitive agreement related to the transaction.
FMAC has received TSXV approval to loan up to $225,000 to FWTC, inclusive of the latest $25,000 loan.
In connection with the transaction, FMAC plans to raise a minimum of $1.4 million through the sale of subscription receipts at $0.15 each. Each receipt grants the holder one FMAC common share and half of a common share purchase warrant. Each whole warrant allows the purchase of one FMAC share at $0.20, exercisable within three years from issuance.
The transaction will include a 10-for-1 consolidation of FWTC common shares. Following this, FMAC shares and warrants will be exchanged on an approximately one-for-one basis for FWTC common shares and purchase warrants, respectively.
Assuming the full $1.4 million is raised, this will result in the issuance of 9,712,792 post-consolidation FWTC shares to investors upon closing.
The resulting issuer's shares will be listed on the TSXV. The subscription receipts' effective price per FWTC share is $0.144 post-consolidation.
Both companies continue to work towards executing the definitive agreement for this transaction, which positions FWTC as the resulting issuer.