MONTREAL, Jan. 22, 2020 - 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 Releases
Neither 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 Statements
This 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.
