The within Offering has been completed on essentially the same terms as the Company's short-form public offering of convertible debentures previously announced by the Company on August 23, 2012 (the "Previous Debenture Offering") which was combined with an equity private placement of units at the same time.
Under the Previous Debenture Offering and related equity private placement, the Company sought to raise an aggregate of $18.0 million and closed on approximately $12.5 million of convertible debentures and equity units in September of last year. The current Offering's aggregate gross proceeds of $5.0 million have now substantially completed the funding goal of the Company's Previous Debenture Offering and equity private placement. Difference Capital, Global Securities Corporation, Cormark Securities Inc. and Macquarie Private Wealth Inc. acted as finders in connection with the Offering.
"We are very pleased to have fully completed this funding goal," said Ken Barker, CEO of CRAiLAR. "The completion of this financing is an important step in our company's growth strategy as we now move forward on a more senior listing while we simultaneously prepare to deliver finished fiber at increased capacities from our present manufacturing facility. CRAiLAR in now in a more ideal position for introduction on a more visible and globally accessible platform."
The within Debentures will mature on September 30, 2017 (the "Maturity Date") and will accrue interest at a rate of 10.0% per annum payable semi-annually in arrears on March 31st and September 30th in each year commencing September 30th, 2013. At the holder's option, the Debentures may be converted into common shares in the capital of the Company (each a "Share") at any time up to the earlier of the Maturity Date and the business day immediately preceding the date specified by the Company for redemption of the Debentures.
The conversion price, subject to adjustment in certain circumstances, will be $2.90 per Share, being a conversion rate of approximately 344.828 Shares for each $1,000 principal amount of Debentures. The Debentures will not be listed for trading on the TSX Venture Exchange (the "Exchange") or any other public market.
The Company intends to use the net proceeds of the Offering to fund the Company's capital program and for general corporate purposes.
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