The FULL news releaseForterra Environmental Completes Private-Placement Financing
<< - Issue of debentures and other bridge loans provide company with nearly $389,000 of capital through seasonal selling period - Loans reflect support for the company by certain directors and other individuals - Company reports initial shipments through national supplier to Weed Man and other retailers as spring season begins to heat up >> PUSLINCH, ON, April 20 /CNW/ - Forterra Environmental Corp. (TSXV: FTE),a manufacturer, marketer, and seller of premium organic soil-enrichmentproducts based on worm castings, today announced that it has raised $214,400through the non-brokered issue of a 12% Secured Debenture - Series B to threedirectors of the company. The financing is intended to be a bridge loan with the debentures andinterest due and payable on August 31, 2010, subject to earlier redemptionwithout any penalty at the option of Forterra. Subject to the approval of theTSX Venture Exchange, the three lenders will receive Bonus Shares at the rateof four common shares of Forterra for every $1.00 principal amount of the loan(a total of 857,600 shares to be issued). The deemed value of the commonshares to be issued is
.05 per share. In addition, Forterra also has received loans totaling $174,539.35 fromcertain holders of 12% Secured Debentures - Series A that were issued by thecompany in April 2009. Payments on the Series A debentures were to be made, inpart, when Forterra received tax incentive payments from the Canadian federalgovernment under the Scientific Research and Experimental Development Program(SR&ED). After receiving their payments from the SR&ED funds paid to Forterra,the individuals elected to loan them back to the company. Terms of these loansare the same as those for the 12% Secured Debenture - Series B, with theexception that no Bonus Shares are being issued. "The decision by the lenders to make these loans to Forterra is based onour recognition of the company's immediate need for capital during the currentcritical seasonal selling period, our appreciation of the progress that thecompany has been making in attracting significant new customers, and ourexpectation that its sales efforts will be successful," said Don Green,Forterra's Chairman and Chief Executive Officer. Mr. Green is one of thelenders receiving the Class B debentures and, as a holder of Class Adebentures, who has elected to lend back to the company the payments that hereceived from the SR&ED funds. "Forterra has begun shipping to the national supplier with which we areworking to provide our product to Weed Man franchises and other customers,"said Rick Denyes, Forterra's president and chief operating officer. "The arrival of unseasonably warm weather is welcome, but, like everyone,it caught our customers by surprise and has not had an immediate effect onorders. We expect that the next four to eight weeks will give Forterra a farbetter appreciation of the potential level of our sales in the second andthird quarters of this year. So far, the feedback that we have been getting isvery encouraging and we have been increasing our inventory to meet the surgein shipments that we hope to be making over the next few months," hecontinued. Forterra will use the proceeds of the loans to make payments on keyaccounts payable, as working capital, and for investments in its plant andequipment to enhance its production operations. About Forterra Environmental Corp. Forterra manufactures, markets, and sells environmentally friendly soilenhancers, using worm castings, which boost fertility while restoring the soilwith organic matter for sustainable, longer-term benefits, including strongerroot growth, and drought and pest resistance. Forterra products contain onlyorganic material. They are ideal for golf courses, sports fields, lawn care,parks, nurseries, orchards, and vineyards. Essentially, Forterra uses redwriggler worms to convert organic material into vermicompost or worm castings.Worm castings contain micronutrients, which are required for healthy plantdevelopment. Worm castings also contain microbes, which increase the rate atwhich plants take up available macronutrients and micronutrients. Furtherinformation is available on the company's website at www.forterra.com. Forward-Looking Statements This news release contains forward-looking statements based on currentexpectations. These forward-looking statements entail various risks anduncertainties that could cause actual results to differ materially from thosereflected in these forward-looking statements. Such statements are based oncurrent expectations, are subject to a number of uncertainties and risks, andactual results may differ materially from those contained in such statements.These uncertainties and risks include, but are not limited to, availability ofresources, competitive pressures, changes in market activity, the ability tosign contracts with customers, the development of markets for worm castings,its ability to breed and maintain a sufficiently large worm population, andregulatory requirements. Risks and uncertainties about Forterra's business aremore fully discussed in the company's disclosure materials, including itsannual information form and MD&A, filed with the securities regulatoryauthorities in Canada. Forterra assumes no obligation to update anyforward-looking statement or to update the reasons why actual results coulddiffer from such statements.