Comet Industries Announces Non-Dilutive Debt Financing to Fund the Ongoing Development of the Iron Mask Project in Kamloops BC.

Executive Summary

• Comet Industries Ltd. entered into a secured, non‑revolving term loan agreement with a syndicate of four private lenders for CAD $2,000,000.
• The one‑year loan bears interest at 10% per annum, includes a $20,000 commitment fee, and is secured by a first‑ranking mortgage over the Kamloops subdivision lands and related assets.
• Proceeds are earmarked for environmental remediation, obtaining a Certificate of Compliance, and paying trade creditors, contractors, subcontractors, and material suppliers for Phase 1 of the Iron Mask Project; repayment is expected from lot sales in Phase 1.

Key Details

• Loan Amount: CAD $2,000,000 principal.
• Interest Rate: 10% per annum, calculated semi‑annually (not in advance).
• Payment Terms: Monthly interest‑only payments; maturity on January 9, 2027.
• Commitment Fee: $20,000 added to the outstanding principal, accruing interest at the same rate as the loan.
• Prepayment: Allowed prior to maturity, subject to payment of all accrued interest for the full term and the commitment fee.
• Use of Proceeds – Restricted To:
  1. Completion of environmental remediation work and obtaining a Certificate of Compliance from the Ministry of Environment and Parks.
  2. Payment of trade creditors, contractors, subcontractors, and material suppliers related to subdivision and construction activities.
• Security Package: First‑ranking mortgage over Kamloops subdivision lands, assignment of rents, assignment of project documentation, and a first‑ranking general security agreement over all personal property tied to the project; registration under BC’s Personal Property Security Act.
• Lender Structure: Syndicate of four arm’s‑length private lenders; not a related‑party transaction.
• Repayment Source: Anticipated proceeds from sale of lots in Phase 1 of the Iron Mask Project.
• Conversion Rights: Loan is non‑convertible without prior TSX Venture Exchange approval; no bonus securities, finder’s fees, or other compensation to lenders beyond the commitment fee.

Notable Quotes

“This financing provides Comet with the necessary capital to advance Phase 1 of the subdivision while addressing environmental obligations and settling outstanding trade accounts,” said management of Comet.
— Mike O’Reilly, President and CEO

Materiality Assessment: Material – Positive (the loan furnishes essential funding for project advancement and environmental compliance, supporting future revenue generation.)