Syntholene closes $3.75-million private placement

Executive Summary

• Syntholene Energy Corp. has closed an oversubscribed non-brokered private placement raising aggregate gross proceeds of $3.75 million.
• The company issued 8,333,333 units at a price of $0.45 per unit, with proceeds allocated to the procurement and assembly of components for its demonstration facility in Iceland, as well as working capital and corporate initiatives.
• The transaction involved significant related-party participation, including a substantial acquisition by Director John Kutsch, triggering early warning disclosure requirements, and the issuance of warrants and shares to financial advisors Canaccord Genuity and Haywood Securities.

Key Details

• Financing Structure: Non-brokered private placement closed for $3.75 million in gross proceeds.
• Units Issued: 8,333,333 units issued at $0.45 per unit.
• Warrant Terms (Investors): Each unit includes one non-transferable common share purchase warrant. Warrants are exercisable into one common share at $0.63 per share for two years. Acceleration provision applies if the share price exceeds $0.90 for 10 consecutive trading days, causing expiry 30 days after notice.
• Use of Proceeds: Procurement and assembly of components for the demonstration facility in Iceland; corporate marketing, investor relations, and working capital.
• Statutory Hold: All securities subject to a four-month-and-one-day hold period.
• Related Party Transactions (MI 61-101):
  • John Kutsch (Director/Officer): Acquired 1,455,556 units for $655,000.
  • Grant Tanaka (CFO): Acquired 111,111 units for $50,000.
  • Anna Pagliaro (Director): Acquired 22,222 units for $10,000.
  • Exempt from formal valuation and minority shareholder approval as the company is not listed on specified markets and related party consideration is less than 25% of market cap.
• Early Warning Disclosure (John Kutsch):
  • Pre-closing beneficial ownership: ~22.6% (non-diluted) / ~25.86% (partially diluted).
  • Post-closing beneficial ownership: ~21.96% (non-diluted) / ~26.23% (partially diluted).
  • Holdings include common shares, options, RSUs, and deferred consideration shares (DCSs).
• Advisor Compensation (Canaccord Genuity Corp.):
  • Cash commission: $112,032.
  • Issued 248,960 non-transferable broker warrants (exercisable at $0.45/share for two years).
  • Issued 111,111 corporate finance shares.
  • Issued 111,111 non-transferable corporate finance warrants (exercisable at $0.63/share for two years, subject to acceleration).
  • Fiscal advisory agreement extended right of first refusal for 18 months from closing.
• Advisor Compensation (Haywood Securities Inc.):
  • Cash commission: $7,992.
  • Issued 17,760 non-transferable broker warrants (exercisable at $0.45/share for two years).

Notable Quotes

• "We are thrilled to have successfully closed this financing, which reflects strong investor confidence in Syntholene's technology and vision," said Daniel Sutton, chief executive officer. "These proceeds will accelerate the development of our demonstration facility in Iceland as we continue to advance our mission of delivering cost-competitive, carbon-neutral synthetic fuel."