Hydreight arranges $10-million debenture offering

Executive Summary

• Hydreight Technologies Inc. has entered into an agreement with Canaccord Genuity Corp. to act as lead agent and sole bookrunner for a best-effort private placement of up to $10 million in unsecured convertible debentures.
• The debentures carry a 9.0% fixed annual interest rate, mature in 36 months, and are convertible into common shares at a price of $4.06 per share.
• The company has granted the lead agent a 6% cash commission and compensation warrants exercisable at $3.74 per share, with net proceeds intended for general corporate and working capital purposes.

Key Details

• Offering Size: Up to $10 million aggregate principal amount of unsecured convertible debentures, issued in $1,000 multiples.
• Over-Allotment Option: The lead agent has an option to increase the offering size by up to $1.5 million, exercisable up to 48 hours prior to closing.
• Maturity: 36 months from the date of issuance.
• Conversion Price: $4.06 per debenture share.
• Forced Conversion Right: If the daily volume-weighted average trading price of common shares on the TSX Venture Exchange exceeds 125% of the conversion price for 20 consecutive trading days (after the two-year anniversary of closing), the company may force conversion. Notice must be issued within 10 days of the trigger, with conversion occurring no fewer than 30 calendar days after the press release.
• Interest Rate: Fixed rate of 9.0% per annum, payable semi-annually in arrears on June 30 and December 31. First payment date is December 31, 2025.
• Use of Proceeds: General corporate and working capital purposes.
• Agent Compensation:
  • Cash commission: 6.0% of the aggregate principal amount of debentures sold.
  • Compensation Warrants: Equal to 6.0% of the number of debenture shares issuable upon conversion.
  • Warrant Terms: Exercisable for one common share each at an exercise price of $3.74 for a period of 24 months from the closing date.
• Closing Date: Expected on or about September 4, 2025, subject to regulatory approvals including TSX Venture Exchange conditional approval.
• Hold Period: All debentures, agent warrants, and resulting shares are subject to a statutory hold period of four months and one day from the closing date under Canadian securities laws.