Kadestone Capital Corp. Closes Second Tranche of Convertible Note Financing
MWN-AI** Summary
Kadestone Capital Corp. (TSXV: KDSX) has successfully closed the second tranche of its non-brokered private placement of secured convertible notes and common share purchase warrants, initially announced on February 25, 2026. In this second tranche, the company issued two convertible notes with a total principal amount of $330,000 along with 660,000 warrants. When combined with proceeds from the first tranche, Kadestone has raised a total of $1.98 million from this private placement.
The company has opted to extend the private placement until April 30, 2026, operating under the same terms as previously outlined. The convertible notes have a maturity period of 36 months from issuance, bearing an interest rate of 10% per annum, compounded monthly, payable upon redemption or conversion. Holders of these notes have the option to convert their principal and accrued interest into common shares at a conversion price of $0.50 per share on the maturity date, pending approval by the TSX Venture Exchange (TSXV).
Each warrant permits the holder to purchase one common share at a price of $0.60 for a period of 36 months from issuance. The proceeds from this financing will be allocated towards reducing debt as well as for general corporate purposes. All securities issued will be subject to a four-month and one day hold period under Canadian securities law, expiring on August 11, 2026.
Kadestone Capital's strategic focus encompasses investment in residential and commercial properties, as well as procurement and sale of building materials in urban areas and fast-growing markets in Canada, reflecting its ambition to emerge as a leading vertically integrated property company. Further information is available on their website.
MWN-AI** Analysis
Kadestone Capital Corp. (TSXV: KDSX) has recently announced the closing of the second tranche of its non-brokered private placement, raising a total of $1.98 million from the issuance of secured convertible notes and warrants. This financial maneuver reflects an important strategic endeavor, especially as the company seeks to bolster its capital structure and fund corporate initiatives, including debt repayment.
The issuance of convertible notes with a 10% interest rate is noteworthy, as it provides investors with a compelling yield, particularly in the current low-interest-rate environment. This high-interest offering may attract investors seeking enhanced returns, given the additional upside potential through the conversion feature at a favorable price of $0.50 per common share. The conversion price is below the current trading price, which can suggest potential for capital gain should the company execute its growth strategy effectively.
Moreover, the accompanying warrants priced at $0.60 provide an extra incentive for investors, granting them the opportunity to acquire shares at a premium if the company’s performance improves. The three-year maturity period aligns well with Kadestone’s commitment to long-term strategic growth in residential and commercial real estate, essential given the competitive landscape.
However, while these developments indicate ambitious growth potential, investors should remain mindful of inherent risks, including the company's dependency on securing additional financing and the volatile nature of real estate markets. The completion of this private placement is contingent upon final approval from the TSX Venture Exchange, and the securities will have a statutory hold period until August 11, 2026, which may affect liquidity.
Investors are advised to keep a close watch on Kadestone’s execution of its business plans, as well as the broader market conditions, to gauge potential returns against the backdrop of these risks. Overall, those considering investment should weigh both the attractive financial terms and the accompanying uncertainties.
**MWN-AI Summary and Analysis is based on asking OpenAI to summarize and analyze this news release.
NOT FOR DISTRIBUTION TO U.S. NEWSWIRE SERVICES OR FOR DISSEMINATION IN THE UNITED STATES
Vancouver, British Columbia--(Newsfile Corp. - April 13, 2026) - Kadestone Capital Corp. (TSXV: KDSX) ("Kadestone" or the "Company") is pleased to announce that it has closed the second tranche of its non-brokered private placement announced on February 25, 2026 (the "Private Placement") of secured convertible notes ("Convertible Notes") and common share purchase warrants ("Warrants"). Pursuant to the second tranche of the Private Placement, the Company issued two Convertible Notes in the aggregate principal amount of $330,000 and 660,000 Warrants. Together with the proceeds of the first tranche of the Private Placement, the Company has raised aggregate gross proceeds of $1.98 million. The Company also announces that it is extending the Private Placement, under the same terms as previously disclosed, until April 30, 2026.
The Convertible Notes will mature on the date that is 36 months after issuance (the "Maturity Date"), subject to acceleration upon the occurrence of an event of default, and will bear interest at a rate of 10% per annum, compounded monthly and payable on redemption or conversion. On the Maturity Date, the principal amount of the Convertible Notes, together with accrued and unpaid interest, will be convertible into common shares in the capital of Kadestone ("Common Shares") at the option of the holder at a conversion price of $0.50 per Common Share (the "Conversion Price"). Notwithstanding the foregoing, any conversion of interest accrued on the Convertible Notes, including the conversion price applicable thereto, will be subject to the prior approval of the TSX Venture Exchange ("TSXV"). For additional information regarding the Convertible Notes, please refer to the Company's news release dated March 11, 2026.
Each Warrant will entitle the holder to purchase one Common Share at a price of $0.60 per Common Share for a period of 36 months from issuance, subject to customary adjustments.
The proceeds of the second tranche closing will be used to pay down debt and for general corporate purposes.
The securities issued pursuant to the second tranche of the Private Placement, including any underlying Common Shares, will be subject to a four-month and one day statutory hold period, expiring August 11, 2026, in accordance with applicable Canadian securities laws. The Private Placement remains subject to the final approval of the TSXV.
About Kadestone
Kadestone was established to pursue the investment in, acquisition, development and management of residential and commercial income producing properties, and procurement and sale of building materials within major urban centres and high-growth, emerging markets in Canada. The Company operates five complimentary business lines spanning building materials procurement and supply, property development and construction, construction finance, asset ownership and property management. These synergistic business lines have solidified Kadestone's vision to become a market leading vertically integrated property company. Additional information can be found at www.kadestone.com.
For further information please contact David Negus, CFO, Kadestone Capital Corp., dnegus@kadestone.com, 604 671-8142.
ON BEHALF OF THE BOARD
(signed) "Kevin Hoffman"
CEO and Director
Neither 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.
Cautionary Statement Regarding Forward-Looking Statements
Certain information in this press release, including, but not limited to, statements regarding the Company's objectives, goals and future plans, including the Company's ability to identify opportunities and secure additional investments in 2026 and the Company's vision to become a leading vertically integrated property company, may constitute forward-looking information (collectively, "forward-looking statements"), which can be identified by the use of terms such as "may," "will," "should," "expect," "anticipate," "project," "estimate," "intend," "continue" or "believe" (or the negatives) or other similar variations. Because of various risks and uncertainties, including those referenced below, actual events or results may differ materially from those reflected or contemplated in such forward-looking statements. As a result, you should not rely on such forward-looking statements. Forward-looking statements reflect material expectations and assumptions, including, without limitation, expectations and assumptions relating to Kadestone's ability to receive sufficient financing to execute its business objectives or plans on acceptable terms or at all; Kadestone's ability to realize the anticipated benefits for its synergistic business lines; and the stability of the financial and capital markets. Additional information identifying assumptions, risks and uncertainties relating to Kadestone is contained in Kadestone's filings with the Canadian securities regulators available at www.sedarplus.ca. These risks include, but are not limited to, Kadestone's requirement of significant additional capital; Kadestone's ability to receive sufficient financing to execute its business objectives or plans on acceptable terms or at all; and those other risks and uncertainties described in the "Risk Factors" section of the Company's final prospectus dated September 2, 2020, and in the Management's Discussion and Analysis for the years ended December 31, 2024 and 2023. The forward-looking statements in this press release are applicable only as of the date of this release or as of the date specified in the relevant forward-looking statement. The Company has no intention and undertakes no obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by applicable law.
To view the source version of this press release, please visit https://www.newsfilecorp.com/release/292296
FAQ**
How does Kadestone Capital Corp. plan to utilize the proceeds from the second tranche of the Private Placement, especially concerning debt reduction and general corporate purposes?
What factors will influence Kadestone Capital KDCCF’s ability to convert the Convertible Notes into Common Shares, given the TSX Venture Exchange's approval requirements?
Can you elaborate on the event of default conditions that might accelerate the maturity of the Convertible Notes issued by Kadestone Capital?
What are the anticipated risks and uncertainties related to Kadestone Capital KDCCF’s objectives, particularly regarding its plan to become a leading vertically integrated property company?
**MWN-AI FAQ is based on asking OpenAI questions about Kadestone Capital (OTC: KDCCF).
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