Elixxer Signs Term Sheet for US$12 Million Institutional Loan
January 22 2020 - 9:01AM
Elixxer Ltd. (TSX-V: ELXR and OTC-QB: ELXIF)
(“
ELIXXER” or (the “
Company”) has
signed an indicative term sheet for a US$12 million convertible
loan (the “Loan”) from AD Asset Management LLC (“AD”), a U.S.-based
fund management company.
Mazen Haddad, Elixxer CEO, stated, “We are very
pleased to be working with AD. This financing is intended to
allow Elixxer to execute on our acquisition strategy.”
Ferras Zalt, Elixxer’s Executive Chairman,
stated, “Elixxer has been undertaking significant due diligence on
a number of revenue-generating assets. Elixxer’s management
is reviewing businesses with revenues that exceed US$50 million per
year and show scope for expansion. Internally, we have been
diligent in reducing corporate salaries and overheads. We are
focused at diversification into businesses that can deliver real
and immediate value.”
The Loan will be fully secured, mature in three
years, and bear interest at an annual rate of 10%, payable
semi-annually. The Loan will be drawn down in three
installments of US$4 million each within a twelve-month
period. Elixxer will have the option to pay interest on the
Loan in Elixxer shares, at a price per share equal to the volume
weighted average trading price (“VWAP”) of the
Company’s shares at the time of the interest payment.
AD will have the right to appoint one member to
the Company’s Board of Directors.
Elixxer will issue up to 25 million common share
purchase warrants to AD, pro rata to each drawdown of the Loan.
The warrants will be exercisable for three years from the
date of issuance at a price of $0.10 per share.
Elixxer will have the right to prepay principal
and accrued interest on the Loan with a prepayment penalty equal to
5% per annum on the principal prepaid through maturity. At
maturity, the lender will have the option, exercisable in its sole
discretion, to convert the outstanding principal and accrued
interest into common shares of Elixxer at a price per share equal
to the seven-day VWAP of Elixxer’s shares prior to the date of
conversion, subject to a minimum price of $0.10 per share.
Elixxer will also issue 20 million common shares
to AD Securities America LLC as a fee in connection with the
Loan.
The Loan is subject to completion of a
definitive agreement containing standard representations and
warranties on the part of Elixxer, completion of satisfactory due
diligence by AD, approval by the Boards of Directors of Elixxer and
AD, and regulatory approval, including that of the TSX Venture
Exchange.
About Elixxer Ltd.
(www.Elixxer.com)
ELXR Ltd. is a Canadian public company listed on
the TSX Venture Exchange (TSX-V: ELXR) and the US OTC-QB exchange
(OTCQB: ELXIF).
Through its partners ELXR presently has
significant interests in Australia, Jamaica, Switzerland, Italy and
Canada.
For further information please
contact:President, John McMullen, +1-416-803-0698,
john@elixxer.com
Caution Regarding Press
ReleasesNeither the TSX Venture Exchange nor its
Regulation Service Provider (as that term is defined in the
policies of the TSX Venture Exchange) accepts responsibility for
the adequacy or accuracy of this release.
Notice Regarding Forward Looking
StatementsThis press release may contain forward-looking
statements with respect to Elixxer and its operations, strategy,
investments, financial performance and condition. These statements
can generally be identified by use of forward-looking words such as
“may”, “will”, “expect”, “estimate”, “anticipate”, “intends”,
“believe” or “continue” or the negative thereof or similar
variations. The actual results and performance of Elixxer,
including completion of the Loan and any future investment or
acquisition, could differ materially from those expressed or
implied by such statements. Such statements are qualified in their
entirety by the inherent risks and uncertainties surrounding future
expectations. Some important factors that could cause actual
results to differ materially from expectations include, among other
things, general economic and market factors, competition,
government regulation and the factors described under “Risk Factors
and Risk Management” in Elixxer’s most recent Management’s
Discussion and Analysis filed on SEDAR (www.sedar.com). The
cautionary statements qualify all forward-looking statements
attributable to Elixxer and persons acting on its behalf. Unless
otherwise stated, all forward-looking statements speak only as of
the date of this press release, and Elixxer has no obligation to
update such statements, except to the extent required by applicable
securities laws.
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