#CoTec Holdings Corp. Announces $20 Million Private Placement
VANCOUVER, BC – CoTec Holdings Corp. (TSXV:CTH)(OTCQX:CTHCF) has announced its plan to raise up to $20 million through a non-brokered private placement of unsecured convertible debentures. This initiative is designed to bolster the company’s financial resources for strategic operations.
The convertible debentures will feature a 12.5% annual interest rate, payable semi-annually, with the first payment slated for February 28, 2027. These debentures will mature five years from their issuance date and can be converted into common shares at a price of CAD$1.75 per share at the discretion of the holder.
Furthermore, the offering will allow redemption at any point by the company, with terms stating that the redemption price will encompass the principal amount, accrued interest, and additional interest if redeemed before the third anniversary of issuance.
The net proceeds from this offering are intended to fund equipment purchases for CoTec's HyProMag USA permanent magnet recycling joint venture and to support working capital needs. This venture highlights CoTec's commitment to sustainable resource extraction and recycling, aimed at enhancing mineral supply chains.
Investors should note that the convertible debentures will be unsecured and subordinate to all secured debts of the company, which could pose a higher risk. Additionally, the offering is subject to regulatory approvals, including the TSX Venture Exchange (TSXV), and all securities issued will be subject to a hold period of four months and one day in compliance with securities laws.
CoTec has identified various risks linked with its operations and investments, including market fluctuations, regulatory changes, and uncertainties related to technology deployment, which could impact the success of its ventures.
Some company insiders are expected to participate in this offering, thereby categorizing it as a 'related party transaction.' CoTec intends to rely on exemptions under Multilateral Instrument 61-101 for such transactions.
CoTec Holdings Corp. intends to raise up to $20 million through this private placement, primarily to fund equipment purchases for its HyProMag USA permanent magnet recycling joint venture and for working capital purposes.
The unsecured convertible debentures will bear interest at a rate of 12.5% per annum, payable semi-annually, and have a maturity of five years. Each debenture can be converted into common shares at a price of CAD$1.75 at the option of the holder.
The offering targets institutional and accredited investors, and it is noted that certain insiders of the Company may participate in this offering, categorising it as a 'related party transaction'.
Investments in CoTec's convertible debentures involve several risks, including economic, political, and market factors, technological risks, uncertainties in supply and pricing, and potential project delays or cost overruns, among others.
The offering is expected to close in August 2026, although specific dates may vary depending on various conditions, including regulatory approvals.
Yes, all securities issued in the offering will be subject to a hold period of four months and one day in compliance with applicable securities laws.
CoTec may redeem the convertible debentures at any time, with the redemption price being the principal amount plus accrued interest, and potentially additional interest if redemption occurs before the third anniversary of issuance.
No, the securities being offered have not been, and will not be, registered under the U.S. Securities Act or any applicable U.S. state laws, and cannot be offered or sold in the United States absent registration or an applicable exemption.