(CSE:KNR, OTCQB:KNRLF, FSE:1K8) ("Kontrol" or "Company") a leader in the energy efficiency sector through IoT, Cloud and SaaS technology is pleased to announce that it has completed a $3 Million secured loan financing (the "Loan") with FirePower Capital (the "Lender") on October 30th, 2019. The indicative terms of the loan were initially announced on August 9th, 2019.
The Loan refinances existing debt, providing incremental increased funding capacity and converts approximately $3,000,000 of Kontrol's existing short-term debt into a long-term obligation. The Loan has a three-year term, Bankers' Acceptance rate plus 8% interest, a facility fee, and will be interest only over the first 18 months, with monthly principal repayment beginning thereafter. The Lender will be granted 590,293 common share purchase warrants ("Lender Warrants") with an exercise price of 0.72 cents and a term of five years.
The Company has also reduced the warrant exercise price of 750,000 previously issued common share purchase warrants issued in conjunction with a prior secured loan on September 20, 2018 ("Prior Lender Warrants"). The exercise price has been reduced from 0.75 cents to 0.70 cents. All other warrant terms remain unchanged.
Kontrol also announces that it will not complete any more closings of its convertible debenture offering, initially announced on June 14th, 2019. A total of $1.3 Million was raised from the sale of convertible debentures.
"These financings position our balance sheet for new acquisitions and growth while limiting dilution in our common share structure," says Paul Ghezzi, CEO of Kontrol Energy.
Acquisition Update
Further to Kontrol's news releases of March 14th, 2019 and September 3rd, 2019, regarding the Company's intention to acquire an established and leading provider of electrical retrofit services (the "Target"), the parties continue to work towards that goal. The Target recently completed its 2019 fiscal year end and is expected to provide Kontrol with financial statements prior to December 31st, 2019. Closing of the acquisition is subject to entering into a definitive purchase agreement and the satisfaction of customary conditions, including the approval of the CSE.
New Board of Director Member
Kontrol is pleased to announce that Mr. Ernest Belyea is joining the Board of Kontrol as an Independent Board Member. Mr. Belyea is a lawyer with a long history of working in the Electricity and Power Generation sector, was formerly in-house counsel to the Ontario Power Authority (now IESO) and a partner at two of Canada's leading international law firms. Mr. Belyea is currently the CEO of Purus Power which has developed a patented proprietary platform technology that converts the variable flow of air, water or other mediums into electricity and mechanical power.
