Snipp Interactive Inc. Enters Into a $4.5 Million Secured Convertible Debenture Financing Led by Shen Capital

Executive Summary

• Snipp Interactive Inc. announced a non‑brokered private placement to raise C$4.5 million in senior secured convertible debentures from strategic investors, including insider participation.
• The debentures bear 3.45% simple interest, mature in three years, and are convertible into units (one common share plus one warrant) at $0.08–$0.10 per unit, with additional adjustments tied to a planned 1‑for‑10 reverse split.
• Shen Capital will lead the offering with a C$3.5 million subscription; Lark Investments and CEO Atul Sabharwal will subscribe for C$900 k and C$100 k respectively.

Key Details

• Offering Size: Aggregate gross proceeds of C$4,500,000 (net proceeds to be used for growth initiatives and general working capital).
• Lead Investor: Shen Capital Partners Inc., via affiliated entities, committing C$3,500,000.
• Other Subscriptions: Lark Investments – C$900,000; CEO Atul Sabharwal – C$100,000.
• Interest Rate: 3.45% per annum (simple interest).
• Maturity: Three years from issuance date.
• Interest Payments: Quarterly; first four payments deferred and payable in a lump sum on the 12‑month anniversary of closing.
• Security: First‑ranking security interest over all present and after‑acquired property; guaranteed by Snipp Interactive Inc. (Delaware) and Snipp Interactive Limited (Ireland).
• Conversion Price:
• Until first anniversary – $0.08 per Unit.
• After first anniversary – $0.10 per Unit.
• Post‑consolidation adjustment based on pre‑/post‑split share counts (1 post‑share for every 10 pre‑shares).
• Unit Composition: Each unit = 1 Common Share + 1 Common Share purchase warrant.
• Warrant Terms: One warrant per unit, exercisable at $0.12 per share for 60 months from issuance.
• Forced Conversion (Debentures): If TSX‑V VWAP ≥ $0.20 for 30 consecutive trading days, conversion may be forced starting 12 months after closing.
• Warrant Acceleration: If TSX‑V VWAP ≥ $0.25 for 30 consecutive days, acceleration possible 9 months after issuance (subject to price floor of $0.23 during notice period).
• Board Appointment: Side‑letter agreement provides that Martin Shen (Co‑Founder/GP of Shen Capital) will be appointed to Snipp’s Board upon closing.
• Share Consolidation: Planned reverse split of 1 post‑share for every 10 pre‑shares, to occur within 12 months of closing, subject to TSX‑V approval. Shareholders approved the consolidation at the Jan 9, 2026 AGM/Special Meeting.
• Related Party Transaction: Participation by Lark Investments (≥10% shareholder) and CEO Atul Sabharwal qualifies as a related‑party transaction; exemption relied upon under MI 61‑101 sections 5.5(a) & 5.7(1)(a).
• Regulatory Conditions: Closing subject to customary conditions, including conditional TSX‑V approval; securities will be subject to a statutory hold period of four months plus one day. Not registered in the U.S.

Notable Quotes

(No direct quotes were provided in the release.)