PreveCeutical Medical Inc (CSE:PREV, OTCQB:PRVCF) told its investors that it has entered into a C$700,000 credit facility deal with its former president Kimberly Van Deventer.
In addition, the company has also amended and increased a credit facility agreement with Kimberly Van Deventer and CEO and current president Stephen Van Deventer.
In a statement, the company said under the 2016 credit facility, the lenders entered into a convertible credit facility agreement with the company for a total of C$2mln.
The terms of the 2016 credit facility, states that the amount of any outstanding principal and accrued interest thereon is convertible, after 31 January 2019, into fully paid and non-assessable common shares in the capital of the company at 50 cents per share.
Preveceutical said it has drawn the full C$2mln available under the 2016 credit facility, which bears a simple interest of 5% per annum.
The lenders have signed a waiver, which provides that there will be no demand by the lenders on the funds outstanding under the 2016 credit facility until 31 January 2019.
Pursuant to an amendment to the 2016 credit facility dated 20 April 2018, and in connection with the company's 25-cent private placement, the 2016 conversion price has been cut to 30 cents per share.
2017 credit facility
The company entered into an additional convertible credit facility agreement (2017 credit facility) with its lenders for C$1mln to cover operational expenses.
Under the terms of the facility, the amount of any outstanding principal and accrued interest thereon is convertible into units in the capital of the company at a price of 50 cents per unit.
Each unit consists of one common share in the capital of the company and one transferable common share purchase warrant entitling the holder to purchase one common share at the price of $1 per share for a period of 24 months after the issuance of the units, subject to acceleration.
Any outstanding funds under the 2017 credit facility bears simple interest at a rate of 5% per annum.
The company has now reduced the 2017 conversion price to 30 cents per unit, reduced the exercise price of the warrants to 50 cents per share, and entered into a promissory note with the lenders, increasing the amount available under the 2017 credit facility agreement by C$500,000.
The lenders have also signed a waiver, which provides that there will be no demand by the lenders on the funds outstanding under the 2017 credit facility until 31 Jan 2019.
2018 credit facility
And effective 28 March 2018, the company entered into credit facility agreement with Kimberly Van Deventer for C$700,000 on a revolving basis, with any sums advanced to the company accruing interest at 5% per annum.
Under the terms of the 2018 credit facility, at any time prior to the repayment of the 2018 credit facility in full, Van Deventer has the right to convert any or all of the then outstanding advances (and the interest accrued thereon) into fully paid and non-assessable common shares in the capital of the company at the price of 50 cents per share.
The 2018 conversion price has now been reduced from 50 cents to 30 cents and the company has allowed for future adjustment of the 2018 conversion price in the event of certain share capital transactions.
Preveceutical is a health sciences company that develops innovative preventive therapies utilizing organic and nature identical products.
The company sells CELLB9, an immune system booster, containing polarized and potentiated essential minerals extracted from a novel peptide obtained from Caribbean blue scorpion venom.