Calgary, Alberta, Canada – July 16, 2008 – As previously announced, on October 10, 2006 Genoil Inc. (TSX.V: GNO; OTCBB: GNOLF.OB) entered into loans from Lifschultz Enterprises Co., LLC (“Enterprises”), Sidney B. Lifschultz 1992 Family Trust (the “Trust”), and Lifschultz Family Partnership LP (the “Partnership”), each of which entities are affiliated with the Corporation’s Chairman and Chief Executive Officer (collectively, the “Lenders”), for an original aggregate principal amount of $968,825.19. Such loans were evidenced by the issuance of convertible promissory notes (the “Notes”). In connection with the issuance of the Notes, the Corporation additionally granted an aggregate of 322,941 common share purchase warrants (the “Warrants”) to the Lenders.
Further to an announcement by the Corporation of May 23, 2008, and in connection with the upcoming Annual and Special Meeting of Shareholders (the “Meeting”), the Corporation and the Lender intend to cancel the Notes and Warrants, as amended, and issue new convertible promissory notes (the “New Notes”) in an aggregate principal amount equal to the principal amount of the notes outstanding, together with interest accrued thereon, and new common share purchase warrants (the “New Warrants”).
The New Notes, if approved, are expected to have a conversion price of $0.27 and the New Warrants, if approved, will be exercisable for common shares of the Corporation at an exercise price equal to 150% of the conversion price of the New Notes, such New Notes and New Warrants having a term of 1 year from their date of issuance and otherwise having identical terms as the Notes and Warrants, as amended.
The proposed cancellation of the Notes and Warrants, as amended, and the proposed issuance of New Notes and New Warrants are subject to receipt of all necessary regulatory, Stock Exchange, director and shareholder approvals. As such, shareholders of the Corporation will be asked to approve the cancellation of the Notes and Warrants, as amended, and the proposed issuance of New Notes and New Warrants to the Lenders at the Meeting.
Genoil Inc. is an international engineering technology development company based in Alberta, Canada that develops innovative hydrocarbon, oil and water separation, and marine technologies.
For further information contact:
Chairman and CEO
ADVISORY: The TSX Venture Exchange has neither approved nor disapproved of the information contained herein.