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NXT Announces Receipt of Final Tranche of Convertible Debenture Offering

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NXT Energy Solutions has completed the final tranche of a planned private placement of US$900,000 convertible debentures to Ataraxia Capital, with the final amount being US$400,000. The debentures bear 10% annual interest, are payable in two years, and are convertible to common shares at US$0.24 per share. Ataraxia now owns US$2.3 million in debentures, potentially representing 14.7% of outstanding shares upon conversion. The proceeds will support working capital needs for upcoming SFD® surveys in Africa and Southeast Asia, along with administrative and business development activities.

NXT Energy Solutions ha completato l'ultima tranche di un'operazione di collocamento privato di 900.000 USD in obbligazioni convertibili con Ataraxia Capital, con l'importo finale pari a 400.000 USD. Le obbligazioni prevedono un interesse annuale del 10%, scadono in due anni e possono essere convertite in azioni ordinarie a 0,24 USD per azione. Ataraxia possiede ora 2,3 milioni di USD in obbligazioni, che potrebbero rappresentare il 14,7% delle azioni in circolazione una volta convertite. I proventi supporteranno le esigenze di capitale circolante per i prossimi sondaggi SFD® in Africa e nel Sud-est asiatico, insieme a attività amministrative e di sviluppo aziendale.

NXT Energy Solutions ha completado la última parte de una colocación privada planificada de 900.000 USD en bonos convertibles a Ataraxia Capital, siendo el monto final 400.000 USD. Los bonos devengan un interés anual del 10%, son pagaderos en dos años y son convertibles en acciones ordinarias a 0,24 USD por acción. Ataraxia ahora posee 2,3 millones de USD en bonos, lo que podría representar el 14,7% de las acciones en circulación tras la conversión. Los ingresos apoyarán las necesidades de capital de trabajo para las próximas encuestas SFD® en África y el Sudeste Asiático, además de las actividades administrativas y de desarrollo empresarial.

NXT Energy Solutions는 Ataraxia Capital에게 900,000 USD 규모의 전환형 채권 사모 배정의 마지막 분할을 완료하였으며, 최종 금액은 400,000 USD입니다. 이 채권들은 연 10%의 이자를 발생시키며, 2년 후에 만기가 되고, 0.24 USD의 가격으로 보통주로 전환할 수 있습니다. Ataraxia는 이제 2.3 백만 USD의 채권을 보유하며, 이는 전환 시 유통 주식의 14.7%에 해당할 수 있습니다. 수익금은 아프리카 및 동남아시아에서의 SFD® 조사와 함께 관리 및 사업 개발 활동에 필요한 운전 자본을 지원하는 데 사용될 것입니다.

NXT Energy Solutions a complété la dernière tranche d'un placement privé prévu de 900 000 USD en obligations convertibles à Ataraxia Capital, le montant final étant de 400 000 USD. Les obligations portent un intérêt annuel de 10 %, sont remboursables dans deux ans et peuvent être converties en actions ordinaires à 0,24 USD par action. Ataraxia détient maintenant 2,3 millions USD d'obligations, ce qui pourrait représenter 14,7 % des actions en circulation après conversion. Les produits serviront à soutenir les besoins en fonds de roulement pour les prochaines enquêtes SFD® en Afrique et en Asie du Sud-Est, ainsi que les activités administratives et de développement commercial.

NXT Energy Solutions hat die letzte Tranche einer geplanten Privatplatzierung von 900.000 USD in wandelbare Schuldverschreibungen bei Ataraxia Capital abgeschlossen, wobei der Endbetrag 400.000 USD beträgt. Die Schuldverschreibungen werfen einen jährlichen Zins von 10 % ab, sind in zwei Jahren fällig und können zu einem Preis von 0,24 USD pro Aktie in Stammaktien umgewandelt werden. Ataraxia besitzt jetzt 2,3 Millionen USD an Schuldverschreibungen, was nach der Umwandlung 14,7 % der ausstehenden Aktien darstellen könnte. Die Einnahmen werden die Bedürfnisse des Betriebskapitals für anstehende SFD®-Befragungen in Afrika und Südostasien sowie Verwaltungs- und Geschäftsentwicklungsaktivitäten unterstützen.

Positive
  • Secured US$900,000 in convertible debenture funding
  • Funding will support upcoming SFD® surveys in Africa and Southeast Asia
  • Strategic partnership with Ataraxia Capital strengthened through completed funding commitment
Negative
  • 10% annual interest rate indicates relatively high cost of capital
  • Potential 14.7% shareholder dilution if debentures are fully converted
  • Secured debt adds to existing financial obligations

CALGARY, AB / ACCESSWIRE / November 12, 2024 / NXT Energy Solutions Inc. ("NXT" or the "Company") (TSX:SFD)(OTCQB:NSFDF) is pleased to announce it has completed the final tranche of a planned private placement of an aggregate principal amount of US$900,000 (approximately CDN$1,252,170) of convertible debentures (the "2024 Debentures") to Ataraxia Capital ("Ataraxia"), in the amount of US$400,000, (approximately CDN$556,520), pursuant to the terms of the subscription agreement signed between Ataraxia and NXT in 2023 (the "2024 Debenture Placement"). The Toronto Stock Exchange (the "TSX") has provided conditional approval of the final phase of this 2023 agreement. For additional information regarding the 2024 Debenture Placement, please refer to NXT's issuer profile on www.sedarplus.ca.

The 2024 Debentures bear interest at 10.0% per annum, paid quarterly in arrears, and are due and payable two years after the issue date. The 2024 Debentures are convertible into common shares of NXT (the "Common Shares") at a conversion price of US$0.24 (approximately CDN$0.324) per Common Share, which provides Ataraxia with the right to obtain up to 3,750,000 Common Shares of NXT. The 2024 Debentures may also be converted into voting preferred shares of NXT (the "Preferred Shares") with an annual dividend rate of 10% paid quarterly in arrears. The Preferred Shares are not transferable, but may be converted on a one-to-one basis into Common Shares. The 2024 Debentures are payable on demand and are secured by a general security agreement, subordinate to the Business Development Bank of Canada's Highly Affected Sectors Credit Availability Program loan.

After completing the 2024 Debenture Placement, Ataraxia owns an aggregate of US$2,300,000 2023 and 2024 Debentures (collectively, the "Ataraxia Debentures"), representing the right to own, after conversion of the Ataraxia Debentures, up to 13,540,209 Common Shares, representing approximately 14.7% of the issued and outstanding Common Shares (after giving effect to the conversion of the full amount of the Ataraxia Debentures).

The proceeds from the 2024 Debenture Placement will be used to support the working capital needs of the upcoming SFD® surveys in Africa and Southeast Asia, and other general and administrative costs which include business development and marketing activities required to transform the existing pipeline of SFD® opportunities into firm contracts.

Commenting on the 2024 Debenture Placement, Bruce G. Wilcox, CEO of NXT said, "We are very pleased and grateful that our strategic alliance partner, Ataraxia Capital, has now totally fulfilled its debenture funding commitment made last year."

In accordance with MI 61-101 - Protection of Minority Security Holders in Special Transactions ("MI 61-101"), the Company's issuance of the Debentures to Ataraxia constitutes a "related party transaction".

The Company has relied on exemptions from the formal valuation and minority shareholder approval requirements of MI 61-101 contained in sections 5.5(a) and 5.7(1)(a) of MI 61-101 in respect to the issuance of the Debentures to Ataraxia as the fair market value of the Debentures is below 25% of the Company's market capitalization (in each case as determined in accordance with MI 61-101).

Please note that the securities described herein have not been, and will not be, registered under the United States Securities Act of 1933, as amended (the "1933 Act"), or any state securities laws, and accordingly, may not be offered or sold within the United States except in compliance with the registration requirements of the 1933 Act and applicable state securities requirements or pursuant to exemptions therefrom. This news release shall not constitute an offer to sell or the solicitation of an offer to buy nor shall there be any sale of the securities in the United States or in any other jurisdiction in which such offer, solicitation or sale would be unlawful.

About NXT Energy Solutions Inc.

NXT Energy Solutions Inc. is a Calgary-based technology company whose proprietary SFD® survey system utilizes quantum-scale sensors to detect gravity field perturbations in an airborne survey method which can be used both onshore and offshore to remotely identify traps and reservoirs with hydrocarbon and geothermal exploration potential. The SFD® survey system enables our clients to focus their exploration decisions concerning land commitments, data acquisition expenditures and prospect prioritization on areas with the greatest potential. SFD® is environmentally friendly and unaffected by ground security issues or difficult terrain and is the registered trademark of NXT Energy Solutions Inc. NXT Energy Solutions Inc. provides its clients with an effective and reliable method to reduce time, costs, and risks related to exploration.

Contact Information

For investor and media inquiries please contact for NXT Energy Solutions Inc.:

Michael Baker
Investor Relations
302, 3320 - 17th AVE SW
Calgary, AB, T3E 0B4
+1 403 264 7020
nxt_info@nxtenergy.com
www.nxtenergy.com

Forward-Looking Statements

Certain information provided in this press release may constitute forward-looking information within the meaning of applicable securities laws. Forward-looking information typically contains statements with words such as "will", "may", "can", "enable" or similar words suggesting future outcomes or an outlook. Forward-looking information in this press release includes, but is not limited to, information regarding: the conversion of any issued and outstanding Ataraxia Debentures into Common Shares or Preferred Shares, as applicable, the shareholdings of Ataraxia following conversion of its issued and outstanding Ataraxia Debentures, and the anticipated use of the proceeds raised through the issuance of the 2024 Debentures. Although the Company believes that the expectations and assumptions on which the forward-looking statements are based are reasonable, undue reliance should not be placed on the forward-looking statements because the Company can give no assurance that they will prove to be correct. Since forward-looking statements address future events and conditions, by their very nature they involve inherent risks and uncertainties. Actual results could differ materially from those currently anticipated due to a number of factors and risks. Risk factors facing the Company are described in its most recent annual information form for the year ended December 31, 2023 and MD&A for the three and nine months ended September 30, 2024, which have been filed electronically by means of the System for Electronic Document Analysis and Retrieval ("SEDAR+") located at www.sedarplus.ca. The forward-looking statements contained in this press release are made as of the date hereof, and except as may be required by applicable securities laws, the Company assumes no obligation to update publicly or revise any forward-looking statements made herein or otherwise, whether as a result of new information, future events or otherwise.

SOURCE: NXT Energy Solutions Inc.



View the original press release on accesswire.com

FAQ

What is the total value of the convertible debentures issued by NXT Energy (NSFDF) in the 2024 placement?

The total value of the 2024 Debenture Placement is US$900,000, with the final tranche being US$400,000.

What is the conversion price for NXT Energy's (NSFDF) 2024 convertible debentures?

The 2024 Debentures are convertible into common shares at US$0.24 per share.

What is the interest rate and maturity period for NXT Energy's (NSFDF) 2024 convertible debentures?

The debentures bear 10.0% interest per annum, paid quarterly, and mature two years after the issue date.

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