Calgary, Alberta – June 27, 2018 – FLYHT Aerospace Solutions Ltd. (TSX-V: FLY) (OTCQX: FLYLF) (the “Company” or “FLYHT”) announced today it is proposing a non-brokered debt offering of convertible debentures (“Debentures”) of FLY for aggregate gross proceeds of up to $2,000,000.
The details of the debt financing are as follows: the Debentures will mature on the date that is 3 years from the date of issuance (if not otherwise converted) and will bear interest at a rate of 8% per annum, which shall be accrued and paid annually in arrears. The Debentures shall be convertible at the option of the debenture holder into common shares of the Corporation (“Common Shares”) at a conversion rate of $1.30 per share at any time prior to maturity, subject to a forced conversion (at a conversion rate of $1.30 per share) into Common Shares should the closing price of the Company’s Common Shares be equal to or exceed $1.80 for 20 consecutive trading days.
Purchasers of Debentures will receive a capital discount of 2.5% on the financing (meaning that for every $1.00 Debenture acquired, purchasers of Debentures shall pay $0.975 to the Company).
Subject to the approval of the TSX Venture Exchange, up to 769,231 warrants (“Warrants”) will be issued to the purchasers of the Debentures (for every $1.00 principal amount of Debentures acquired pursuant to the offering, Debenture holders will receive approximately 0.3846 Warrants). Each whole Warrant shall be exercisable to acquire one Common Share of the Corporation for a period of two (2) years from the date of issuance at an exercise price of $1.45 per share. The Warrants are subject to an acceleration clause, whereby, if after four months and one day following the date the Warrants are issued, the closing price of the Company’s Common Shares is equal to or exceeds $1.90 for 20 consecutive trading days (with the 20th such trading date hereafter referred to as the “Eligible Acceleration Date”), the Warrant expiry date shall accelerate to the date which is 30 calendar days following the date a press release is issued by the Company announcing the reduced warrant term, provided, no more than five business days following the Eligible Acceleration Date: (i) the press release is issued; and (ii) notices are sent to all warrant holders.
The Debentures are secured against all personal property of the Company and are subordinated in right of payment to all existing and future secured bank and/or governmental indebtedness of the Company and any existing security already registered against FLYHT’s assets.
The net proceeds of the offering will be used to: (i) fund research and development in relation to new products; and (ii) increase FLYHT’s working capital.
All of the securities issued pursuant to the private placement are subject to a four-month hold period. The Debentures will not be listed on any stock exchange. Completion of this debt offering remains subject to the final approval of the TSX Venture Exchange.
About FLYHT Aerospace Solutions Ltd.
FLYHT’s mission is to improve aviation safety, efficiency and profitability (located in Calgary, Canada; publicly traded as: FLY:TSX.V; FLYLF:OTCQX). Airlines, leasing companies, fractional owners and original equipment manufacturers have installed the Automated Flight Information Reporting System (AFIRSTM) on their aircraft to capture, process and stream aircraft data with real-time alerts. AFIRS sends this information through satellite networks to the UpTimeTM Cloud data center, which provides aircraft operators with direct insight into the operational status and health of their aircraft and enables them to take corrective action to maintain the highest standard of operational control.
FLYHT Aerospace Solutions Ltd.
Chief Financial Officer
Adelaide Capital Markets Inc.
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Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.