Kadestone Capital Corp. Closes $3,300,000 Convertible Note Private Placement

Executive Summary

• Kadestone Capital Corp. has closed a non-brokered private placement of secured convertible notes and common share purchase warrants.
• The transaction raises $3.3 million in aggregate principal, accompanied by 8.25 million warrants, with proceeds designated for debt reduction and general corporate purposes.
• The notes carry a 10% compounded monthly interest rate, mature in 36 months, and convert at $0.40/share, while warrants allow purchases at $0.50/share for 36 months.

Key Details

• Instrument: Secured Convertible Notes and Common Share Purchase Warrants
• Aggregate Principal Amount: $3,300,000
• Warrants Issued: 8,250,000
• Conversion Price: $0.40 per Common Share
• Warrant Exercise Price: $0.50 per Common Share
• Warrant Term: 36 months from issuance
• Interest Rate: 10% per annum, compounded monthly, payable upon redemption or conversion
• Maturity Date: 36 months after issuance
• Use of Proceeds: Pay down debt and general corporate purposes
• Automatic Conversion Triggers: Qualifying Transaction (equity financing ≥ $25M) or Change of Control Transaction
• Hold Period: 4 months and 1 day statutory hold, expiring October 12, 2026
• Regulatory Status: Subject to final approval of the TSX Venture Exchange