Pond Technologies Holdings Inc. announced a private placement of convertible debentures for gross proceeds of CAD 5,250,000 with new investor Corton Capital Inc. on June 6, 2023. The principal amount of debenture is CAD 5,250,000. The convertible debentures bear interest at 12% per annum, are convertible into common shares at a conversion price of CAD 0.20 per share, and will mature three years from the date of issuance.

The convertible debentures will be senior, unsecured obligations of the company and will rank senior to any other existing and future subordinated unsecured indebtedness of Pond. The transaction is subject to customary closing conditions, including the approval of the TSXV, and is anticipated to close on or about June 30, 2023. The convertible debentures, and any common shares issued upon conversion, will be subject to a statutory hold period expiring four months and a day from the date of issuance of the convertible debentures.

In connection with closing of the Private Placement, Pond has agreed, subject to certain exceptions, to pay investor a fee equal to up to 6% of the gross proceeds raised under the Private Placement and to issue to investor that number of Common Share purchase warrants of the company that is equal to up to 6% of the gross proceeds raised under the Private Placement, each such warrant having an exercise price of CAD 0.20 per share and expiring three years from the date of issuance.