Ceapro Inc. has undergone a debt restructuring plan that will ease its efforts to raise money for company growth.
Ceapro owns Canamino Inc., which processes oats into products for the cosmetics, personal hygiene and health food markets at a plant in Saskatoon.
Canamino president Robert Binnendyk said the plan saw unsecured creditors holding about $5 million in debt agree to convert their debt into equity in the company.
“The result is that we remove a lot of debt from the company and convert it to capital stock in the company,” he said from company headquarters in Edmonton.
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“It puts us in a much stronger position to proceed with the remainder of the financing that we need to do and in a stronger position to proceed to develop the company.”
The creditors, including the Western Economic Development program, suppliers and legal council, will get payment on their debt in the form of one-third cash and two-thirds shares.
He said the restructuring will make it easier to complete a private placement share offering in which the company is offering special warrants at $1.03 per special warrant to a maximum of $10 million.
The Saskatchewan Government Growth Fund is converting $3.5 million worth of shares in Canamino into these Ceapro special warrants.
At the end of the process, Ceapro expects to have issued a maximum of 13 million shares, have no debt other than about $3 million in bank term debt and will retain about $4 million in cash to provide working capital and enable final commercialization of its products.
