Passport Potash Inc. (TSXV:PPI,OTCQX:PPRTF) has closed its previously announced non-brokered private placement offering of 9.5 percent convertible debentures of the Company for gross proceeds in the amount of US$500,000. Proceeds from the offering will be used to develop Passport’s holdings on the east side of the Holbrook Basin.
As quoted in the press release:
On May 29, 2014, the Company issued a US$500,000 (the “Principal Amount”) convertible debenture (the “Debenture”) which will mature on May 29, 2018 (the “Maturity Date”) and will accrue interest at a rate of 9.5% per annum payable annually as to 50% in cash and 50% in common shares of the Company (each, a “Common Share”), subject to the right of the holder to elect to have an interest payment satisfied entirely in Common Shares. The issuance price of Common Shares to pay accrued interest will be determined by the Market Price of the Common Shares, as defined by the policies of the TSX Venture Exchange (the “Exchange”). The Principal Amount of the Debenture is convertible at any time prior to the Maturity Date, in whole or in part, at the option of the holder into either: (a) units of the Company (the “Units”) at a conversion price of US$0.12 per Unit, with each Unit being comprised of one Common Shares and one common share purchase warrant of the Company (a “Warrant”), with each Warrant exercisable into one Common Share (each, a “Warrant Share”) at a price of US$0.12 per Warrant Share until May 29, 2018, or (b) into 10% of the shares the Company holds in PPI East Block Holding Corp., or pro rata portion thereof for any partial conversion.