Business
Reklaim Ltd. Announces Proposed Debt Conversion
Toronto, Ontario--(Newsfile Corp. - April 3, 2023) - Reklaim Ltd. (TSXV: MYID) (the " Company "...
About this update from Reklaim Ltd
[{"type":"text","content":"Reklaim Ltd. Announces Proposed Debt ConversionToronto, Ontario--(Newsfile Corp. - April 3, 2023) - Reklaim Ltd. (TSXV: MYID) (the \"Company\") is pleased to announce that it has entered into agreements to satisfy certain outstanding indebtedness owed to specific arm's length and non-arms length creditors (the \"Creditors\") through the issuance of common shares (the \"Common Shares\") of the Company (the \"Debt Settlement\"). The Company plans to settle indebtedness of approximately $420,000, or 25.6% of the company's debt, by issuing 14,000,000 Common Shares at a deemed price of $0.03 per Common Share.The Company determined to satisfy the foregoing indebtedness with Common Shares in order to preserve ‎its working capital. The Debt Settlement is subject to the approval of the TSX Venture Exchange (the \"TSXV\"). In addition, the ‎Common Shares issued pursuant to the Debt Settlement will be subject to a four-month hold period from the date of issuance.One of the Creditors, Mr. Neil Sweeney, the Chief Executive Officer of the Company, has agreed to convert $250,000 of the debt owed to him. Mr. Sweeney is considered a \"related party\" to the Company under Multilateral Instrument 61-101 - Protection of Minority Security Holders in Special Transactions (\"MI 61-101\"). Accordingly, the Debt Settlement between the Company and Mr. Sweeney is a \"related party transaction\" under MI 61-101. The debt conversion is exempt from the formal valuation and minority shareholder approval requirements under MI 61-101 pursuant to subsections 5.5(b) and 5.7(1)(a), respectively, of MI 61-101, as the Common Shares are not listed on a specific market, and the fair market value of the Common Shares to be issued to related parties pursuant to the Debt Settlement will not exceed 25% of the Company's market capitalization.The Company also announces that it has granted, effective February 8, 2023, stock options to purchase 2,966,221 common shares of the Company to Mr. Sweeney, CEO. The Options vest immediately upon issuance and are exercisable until February 8, 2028, at an exercise price of $0.035 per share. Mr. Sweeney was granted these options due to taking a reduced salary. The Options are subject to the terms of the Company's 10% rolling stock option plan and the approval and requirements of the TSX.Early Warning DisclosurePursuant to t...