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Loan Agreement

August 25, 2017 – On July 17, 2017, Halio Energy Inc. (“Halio Energy” or the “Company”) (TSXV – HOIL) entered into a Loan Agreement and Demand Promissory Note with Halio Holdings International, Inc. (“Halio Holdings”) in the amount of $171,205.44 USD, The Loan Agreement and Promissory Note mature on October 30, 2017. The Promissory Note also provides for additional future advances to Halio Energy, subject to the terms and provisions of the aforementioned Agreements, which advances may be made solely at the discretion of Halio Holdings. The note bears interest at 8% percent per year payable annually in arrears. As security for the Loan, Halio Energy pledged the Farm-in agreement between Halio Energy and Trendwell West Inc. On July 17, 2017, proceeds from the Loan Agreement totalling $171,205.44 were utilized to pay, in full and complete remediation, the past due and outstanding financial obligations owed by the Company under the Farm-in Agreement. With the payment of the past due obligations under the Farm-in agreement, the Farm-in Agreement is deemed to be current as of this date and all defaults are deemed to have been cured. Halio Holdings will not receive bonus shares for the loan.
Halio Holdings is domiciled in British Columbia, 600-1090 West Georgia Street, Vancouver, BC, V6E 3V7, Canada.
Halio Holdings does not own any shares of Halio Energy. Halio Capital Inc owns a controlling interest in Halio Energy. Miodrag Andric, a director and officer of Halio Energy is also a director and minority shareholder of Halio Holdings and minority shareholder of Halio Capital Inc. Sak Narwal, a consultant of Halio Energy is also an officer, director and minority shareholder of Halio Holdings. and a minority shareholder of Halio Capital.
Halio Energy is currently in discussions with a number of groups in order to obtain sufficient funding to satisfy current and future financial obligations relating to the Company’s obligations under the aforementioned Farm-in agreement, current operating costs and expenses and funds to pay the principle and interest relating to the aforementioned mentioned Loan Agreement & Demand Promissory Note, as well as additional financing to develop the farm-in acreage specified in the Farm-in agreement. Halio Energy, presently, has no revenue sources. Repayment of the loan referenced above on the specified maturity date, is, at this time, entirely dependent on the successful results of future capital raise efforts.