CHARBONE Corporation (TSXV: CH; OTCQB: CHHYF; FSE: K47), a vertically integrated industrial gases company focused on clean ultra-high purity (UHP) hydrogen, has announced the closing of a $1.5 million drawdown from RiverFort Global Opportunities PCC Ltd. This drawdown is part of a larger $3 million second tranche under the company's secured convertible loan facility, which totals up to $10 million. The move underscores CHARBONE's commitment to scaling its hydrogen production capacity and expanding its industrial gas platform across North America.
The closing of this drawdown brings the total principal amount owing under the convertible loan to $4.5 million. The funds are earmarked to accelerate development timelines for the company's clean UHP hydrogen production plants, support capital expenditures and equipment deployment, and provide general working capital for near-term growth initiatives. Benoit Veilleux, CFO and Corporate Secretary of CHARBONE, stated that the proceeds are being deployed directly toward priorities at the Sorel-Tracy project and across the company's industrial gas platform.
The convertible loan is structured with a 12% annual interest rate, payable in cash every four months, and matures on March 4, 2028, for this drawdown. The lender has the option to convert the principal into units consisting of one common share and 0.3 of a warrant at a conversion price of $0.196875 per unit. Additionally, each whole warrant issued will allow the holder to purchase an additional common share at $0.236250 per share for 48 months, subject to regulatory hold periods. The facility is secured by a first-ranking hypothec over the movable property of Charbone Hydrogène Québec Inc. and Charbone Hydrogen Corporation.
This financing is a critical component of CHARBONE's strategy to meet the growing demand for UHP gases in sectors such as semiconductors, artificial intelligence, data centers, pharmaceuticals, and aerospace. The company's modular and decentralized production model aims to provide reliable, localized supply of clean hydrogen and other specialty gases, addressing supply gaps for mid-tier industrial customers. With this capital infusion, CHARBONE is better positioned to execute on its milestones and contribute to the transition to a lower-carbon economy.
RiverFort, the lender, provides debt and equity-based capital to high-growth companies and has executed over US$15 billion in growth financing transactions. The partnership between CHARBONE and RiverFort is expected to facilitate further drawdowns under the facility as the company meets its capital requirements.
For more information about CHARBONE and its projects, visit www.charbone.com. The company's securities are listed on the TSX Venture Exchange, OTC Markets, and the Frankfurt Stock Exchange.
