VANCOUVER, BRITISH COLUMBIA--(Marketwire - July 16, 2012) -
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Functional Technologies Corp. (TSX VENTURE:FEB)(OTCQX:FEBTF) (the "Company") reports that it intends to undertake a non-brokered private placement to raise gross proceeds of up to $1.0 million by the issuance of 5.0 million units at a price of $0.20 per unit. Each unit will consist of one common share and common share purchase warrant. Each share purchase warrant will entitle the holder to acquire one common share at a price of $0.30 for a period of 24 months. At the Company's election, the share purchase warrants will expire 30 days following the Company's written notice of early expiry, which notice may be given if the closing price of the Company's common shares is $0.60 or higher for at least 10 consecutive trading days.
The Company also reports that it has arranged a working capital bridge loan of $250,000 with the ability to request a second draw down of the same amount. Subject to TSX Venture Exchange approval, the Company will issue to the lender, as a bonus for the making of the initial tranche of the loan, 122,549 common shares which will be subject to a hold period expiring on November 13, 2012. The loan matures in one year and bears interest at the rate of 18% per annum during the first year and 22% thereafter, calculated and compounded semi-annually in arrears. The loan agreement provides for the grant of security over certain assets of the Company and the payment of a structuring fee to the lender of 4% on the amount of the funds advanced. Christopher Morris, an executive officer of the Company, is the owner of the general partner of the lender and is also a limited partner.
The bridge loan will help provide the Company the additional time required to close the equity round of financing while minimizing further dilution with what it expects to be a short term interest-bearing debt instrument.
About Functional Technologies Corp.
Functional Technologies develops and commercializes proprietary, advanced yeast-based solutions to significant challenges in the food, beverage and healthcare industries. The Company's platform improves the performance of innate yeast functions, and prevents the formation of naturally occurring toxins and contaminants that either affect final product quality or are classified by the World Health Organization as probable human carcinogens. Functional Technologies' lead technologies include yeasts that prevent and reduce the formation of the foul-smelling hydrogen sulphide (H2S) and the carcinogens acrylamide and ethyl carbamate (more commonly known as urethane), by-products of food and beverage processing. These contaminants are found in many commonly consumed items, such as fermented food products and alcoholic beverages, and baked and fried foods. For more information, please visit our website at www.functionaltechcorp.com.
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.