FACT Corporation operates through its wholly-owned subsidiary, Food & Culinary Technology Group Inc. The company develops and markets customized nutrition solutions for the global baked-goods industry. FACT sells specialty bake mixes to commercial producers who use these mixes to manufacture popular, health-friendly packaged baked goods.

The company announced today that it has successfully negotiated a restructuring of the majority of its short-term debt with various creditors. All of the short-term debt has been converted to long-term, convertible debt. The breakdown of the debt conversions follows:

• On August 20th, the company entered into debt settlement agreements with three creditors to settle debt of $74,692.15 by issuing 746,922 shares at a price of $0.10 per share.
• On September 11th, the company entered into debt settlement agreements with seven creditors to settle debt of $1,304,172.10 by way of convertible loans. The creditors have executed loan agreements for a period of three years at an annual interest rate of 8%. The loans are unsecured and convertible for a period of one year into the company’s class A common stock at a price of $0.15 per share. If converted, FACT would have to issue 8,694,481 shares.
• On September 11th, FACT also renegotiated an outstanding debenture due in December 2009. The company has entered into a new debenture agreement in the amount of $317,517.14 with Ultimate Resort Destinations. The debenture will be re-written for three years and with a 6% interest rate. The debenture is convertible for a period of two years into the company’s class A common stock at a price of $0.14 per share. If converted, FACT would have to issue 2,267,980 shares.

FACT CEO Jacqueline Danforth said, “It’s very encouraging that our key creditors have agreed to enter into long term debt arrangements with the company. This will eliminate a great deal of the short term debt from our balance sheet, allowing management to put together a funding proposal to raise the required capital to fund our future growth plans.”

The company seeks to raise up to $1 million in order to fund the final stage of development of several new product lines it hopes to launch in the spring of 2010.