Junior miner Encanto Potash Corp., Toronto, said on Oct. 4 that it will complete a private placement of convertible debentures for gross proceeds of C$9,505,200. The offering will discharge and replace a portion of the principal owing under the company’s previous convertible debentures that matured on Sept. 1, 2017, which are due and payable, as well as to offset other outstanding payables.
The debentures will be secured by a charge over all of the company’s assets, will bear interest at the rate of 5 percent per annum, and will mature 18 months from date of issue. The debentures will be convertible into common shares at the option of the holders at any time on or before the maturity date at a price of $0.25 per share.
Hamad M. Al-Wazzan, an insider of the company, has agreed to purchase $4.25 million in the offering. Horgen Holdings Inc. has agreed to purchase $5 million, and will become an insider on a partially diluted basis pursuant to the private placement.