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Noveko International Announces $6 Million Financing Consisting of $4 Million Credit Facility and $2 Million Convertible Debentu

^{Published on 2011-07-20 05:20:55 - Market Wire}
 

MONTREAL, July 20, 2011 /CNW Telbec/ - Noveko International Inc. (TSX: EKO) (the "Company") announces that it has signed a term sheet with a private investment firm (the "Lender"), providing for an aggregate financing of $6 million. Under the terms of this term sheet, and subject to customary closing conditions including due diligence and necessary regulatory approvals, the Lender will provide up to $4 million in credit facility, and will subscribe to a convertible debenture in the amount of $2 million. The closing is expected to occur mid-August 2011 (the "Closing").

The net proceeds of these transactions, which carry on the financing initiatives started by the Company earlier during the 2011 fiscal year, will be used to pursue the Company's global growth objectives, as well as for working capital purposes. Concurrently with these initiatives and while focusing on its primary growth segments, the Company is continuing its efforts to better control costs.

The credit facility will be a senior, secured revolving facility in the amount of up to $4 million, made available to the Company in minimum advances of $500,000 each, from time to time, for a twenty-four month period from the Closing (the "Maturity Date"), and subject to the Company's right to terminate the credit facility after the first anniversary of the Closing. The senior, secured, convertible debenture in the amount of $2 million will be issued to the Lender on the Closing. Both the credit facility and the debentures will bear interest at an annual rate, compounded monthly, and paid monthly in arrears equal to a minimum of 12%, adjusted upward for any changes in a selected chartered bank prime rate. A 1% per annum standby fee, payable monthly in arrears, will also be due to the Lender on the portion of the credit facility not disbursed.

The Lender shall have the right, at its sole discretion and at any time during the term, to convert, in whole or in part, the principal of the debenture into Class A shares of the Company, at a conversion price of 0.60$ per share. All advances under the credit facility, as well as the remaining non-converted portion of the debenture, shall be reimbursed by the Company on the Maturity Date. The remaining portion of the debenture, if any, would then be redeemable at 1.5 times their par value.

Profile
Noveko International Inc. offers innovative solutions in the environmental and medical fields worldwide. Through its subsidiaries, the Company specializes primarily in the following business segments: the development, manufacturing and marketing of derivative products from its patented antimicrobial filtration technologies, mainly air filters, surgical masks and respirators, as well as other products with antibacterial properties such as hand sanitizers - and the development, manufacturing and marketing of medical equipment, primarily portable real-time ultrasound scanners for use in human and veterinary medicine.

Certain statements set forth in this press release constitute forward-looking statements. In some cases, these statements are identified by the use of terms such as "may", "could", "might", "intend", "should", "expect", "project", "plan", "believe", "estimate" or other comparable variants. These statements are based on the information available at the time they are written, on assumptions made by management and on the expectations of management, acting in good faith, regarding future events, including those relating to economic conditions, fluctuations in exchange rates and operating expenses, and the absence of unusual events entailing supplementary expenditures. Although management considers these assumptions and expectations reasonable based on the information available at the time they are written, they could prove inaccurate. Forward-looking statements are also subject, by their very nature, to known and unknown risks and uncertainties such as those related to the industry, acquisitions, labor relations, credit, key officers, supply and product liability. The actual results of Noveko International Inc. could differ materially from those indicated or underlying these forward-looking statements. The reader is therefore recommended not to unduly rely on these forward-looking statements. Forward-looking statements do not reflect the potential impact of special items, any business combination or any other transaction that may be announced or occur subsequent to the date hereof. Unless otherwise required under securities laws, the Company does not intend and undertakes no obligation to update or revise the forward-looking statements.