Canadian Oil Recovery and Remediation Enterprises Ltd. (CORRE), a provider of leading edge oil recovery and remediation technologies and services, has entered into binding memoranda of agreement in connection with a two-phase financing for aggregate gross proceeds of up to $10 million. The principal subscriber for $8.5 million of the Financing is Al-Najah Advanced Technology Co. Ltd. (NAT), a wholly-owned subsidiary of Saudi Binladin Group (SBG). The remaining balance of the financing (an aggregate of $1.5 million) is committed by Hassan Dahlawi, an existing director of the company based in Jeddah. The proceeds of the financing will be used to fund the purchasing and fabrication of plant and ancillary equipment as required in support of CORRE's anticipated project pipeline, among others. It will also be used to fund bid and performance bonds, as well as necessary mobilization and site commissioning costs as required for CORRE's expected projects; to fund potential joint partnerships to expand the corporation's oil service product offerings; and for general working capital purposes. John Lorenzo, chief executive officer of CORRE, said: “CORRE is extremely pleased to announce this exceptional moment in the company's history and to consummate this relationship with Saudi Binladin Group. The financial commitment made by SBG will allow CORRE to expedite its business plan and fully exploit the opportunities at hand that would otherwise be challenging to attain. In addition, the relationship with SBG places CORRE in an extremely unique and strong position in the Middle East and North African markets and more specifically in respect of business opportunities within Saudi Arabia, a prime potential market for our products and services. We are thankful for this significant vote of confidence from SBG and look forward to a long and prosperous relationship together.” Phase I of the financing shall consist of the issuance of secured convertible debentures in the aggregate principal amount of $5,000,000 ($4,250,000 issuable to NAT; $750,000 issuable to Dahlawi). These debentures shall have a coupon of 10 percent (payable quarterly in arrears) and a maturity date of one (1) year. The debenture to be issued to NAT shall be subject to extension to the date that is 18 months from the date of issuance and the debenture to be issued to Dahlawi will be subject to extension for one additional year beyond the initial term. The debentures will be convertible into common shares of the company at a price of $0.20 per share at any time prior to maturity at the option of the holder. The debentures will convert into common shares automatically upon review and acceptance by NAT of CORRE's formal five-year business and financial plan. CORRE is currently developing this business and financial plan and will deliver it to NAT within three (3) months of closing of Phase I of the financing. Following receipt of this plan, NAT will have two (2) months to review the plan and provide comments to the company. Provided that NAT accepts the business and financial plan within this timeframe, the debentures (both the NAT convertible debenture and the Dahlawi convertible debenture) will convert automatically into common shares of the company. __
