Mint Corp. completed a debt conversion transaction with its series A and series C debenture holders, reducing its owed debt to its debenture holders by about C$39 million to C$20 million, from C$59 million.
Under the transaction, Mint issued to the debenture holders 17.3 million common shares, 16 million subscription receipts and 11.7 million common share purchase warrants.
Gravitas Financial Inc., the majority equity stakeholder of Mint, directly or indirectly owns 103,857,827 common shares of Mint, representing 59.6% of the outstanding shares.
As a result of the transaction, Gravitas owns 54.1% of the common shares of Mint on a non-diluted basis and would own 47.4% of the common shares of Mint if the subscription receipts and common share purchase warrants were to be converted or exercised at closing. Each common share purchase warrant will be exercisable on or after Jan. 1, 2019, and on or before Dec. 31, 2021, for one common share of Mint at an exercise price of 10 cents.
The subscription receipts are convertible in installments of 2 million shares. The first two installments became convertible today, the date of completion of the debt conversion transaction, with additional installments becoming convertible on June 30 and every three months thereafter until Sept. 30, 2019. The subscription receipts may be converted at the election of the holder on or after the date they become convertible and will expire Dec. 31, 2022.
In addition, the common shares received upon conversion of the subscription receipts will be subject to a contractual one-year hold period commencing on the date that such subscription receipts become convertible.
Mint may issue up to an additional 27.7 million common shares in exchange for approximately C$39 million of debt reduction.
The series A debt of C$20 million is set to commence Oct. 1, 2019, and to mature Dec. 31, 2021. It will bear cash interest at 10% per year, payable quarterly. If Mint does not have enough funds to pay cash interest when required, the deficit will be paid by the issuance of subscription receipts convertible into Mint common shares priced at the greater of 95% of the 10-day volume-weighted average price of the common shares preceding the interest payment date, and the minimum price permitted by the TSX Venture Exchange for such issuance.
Each such subscription receipt will convert, for no additional consideration, into one common share of Mint at the election of the holder, and may be converted within one year from issue. These interest payment subscription receipts, and any common shares issued under them, will be subject to a four-month hold period from the date on which the interest payment subscription receipts are issued. The series A debt along with any accrued interest will become due and payable in cash within 30 days, following a change of control of Mint.
In connection with the conversion and restructuring of series A and C debentures of Mint, Mint received strategic and financial advice from Clariti Strategic Advisors.
