Xylitol Canada Inc. (TSXV:XYL) announced a private placement of secured convertible debentures for the gross proceeds of CAD 1,000,000 on April 8, 2016. The debenture will mature after four years from the effective closing date April 8, 2016. The debenture carries interest rate equals to greater of an annual interest of 15% per annum or a royalty equal to 3% of sales per annum, subject to an annualized combined effective interest of a maximum of 24%. The debentures are convertible into common shares at a price of CAD 0.10 per share. The company may redeem debentures at any time by paying principal amount of the debenture plus all the accrued and unpaid interest. The company will also issue 10,000,000 common share purchase warrants. Each warrant will entitle the holder to purchase one common share at an exercise price of CAD 0.08 per share for the period of two years from the date of closing. The transaction included participation from Fountain Asset Corp. for the gross proceeds of CAD 710,000, existing investor Dundee Agricultural Corp for CAD 250,000 and 2,500,000 warrants and other investors.

TSXV exchange has accepted filing documentation with respect to the transaction. The transaction involved participation from two placees. The convertible debentures are convertible into common shares at CAD 0.10 of principle per share until maturity subject to adjustment with a floor of CAD 0.05 per share in the first year.