News...Wescorp Energy Converts $4,416,825 in Current Demand Debt into Equity and Long-Term Debt
HOUSTON, TX and CALGARY, Sept. 16 /CNW Telbec/ - Wescorp Energy Inc. (OTCBB: WSCE), an oil and gas technology solutions provider, is pleased to announce that it has successfully negotiated four separate debt conversion transactions totaling $4.4 million dollars. Wescorp's three major creditors, includingDoug Biles, President and CEO, have agreed to restructure the debts owed to them by the Company. These conversions will allow Wescorp to become more focused on its Water and Solids Remediation Units, which operate in the multi-billion dollar environmental remediation industry.
The first three transactions convert an aggregate of $1,654,565 in current demand notes into long-term unsecured debt of the same amount. Under the new agreement, no interest or principal payments will be made for two years, until the notes mature, allowing Wescorp to focus on remediation operations and additional revenue generation opportunities.
The fourth transaction will result in $2.25 million in debt converted into 4.5 million common shares of Wescorp at an exchange rate of $0.50 per share. These shares will be subject to resale restrictions for a minimum of one year. In addition, the debt holder has agreed to waive approximately $512,260 in interest payable on this note in exchange for 2.25 million restricted warrants of Wescorp. These warrants will have an exercise price of $1.00 per share and will be valid for a 3-year period.
"Wescorp's management team believes these two events are significant in the Company's progression toward near-term positive cash flow and a strengthening of its balance sheet," commentedMark Norris, Chairman of Wescorp. "It is very encouraging to see two significant financial events happening parallel to our recent positive corporate development of a joint venture with Cancen Oil Canada Corporation. These two restructuring events, in addition to Cancen's recently announced commitment to provide $1,000,000 of funding for the immediate construction of three Wescorp remediation units, improves Wescorp's financial and operating positions in the market place. With the rapid deployment of remediation units to Cancen's western Canadian processing facilities and assuming Cancen's and Wescorp's ability to meet their anticipated schedule, Wescorp believes it will be cash flow positive in 2010."