Elixxer Ltd. Closes Amended Secured Loan with AIP Convertible Private Debt Fund L.P
Montreal, Quebec--(Newsfile Corp. - May 25, 2022) - Elixxer Ltd. (TSXV: ELXR) (OTC Pink: ELIXF) ("Elixxer" or the "Company) is pleased to announce that it has closed its previously announced (see press release of February 22, 2022) amended loan with AIP Convertible Private Debt Fund L.P., AIP Asset Management Inc. and related and affiliated companies ("AIP"). Further to the amendment, AIP has loaned the Company an additional $4 million (the "Additional Disbursement") which will: (i) have a maturity of 24 months from the date of closing; (ii) bear interest at the rate of 17% per annum; and (iii) be secured by a general security agreement on the assets of the Company in favour of AIP.
On closing, the Company paid to AIP (i) a facility fee of $200,000; (ii) a closing fee of $250,000; and (iii) a due diligence fee of $75,000. The Company also issued to AIP a bonus of 643,518 common shares of the Company (the "Bonus Shares") at a deemed issue price of $1.08 per share, representing 20% of the net amount of the Additional Disbursement.
The Company intends to use the proceeds of the Additional Disbursement for working capital purposes and to pursue future investments.
The amended loan and the issuance of the Bonus Shares constitute related-party transactions under Multilateral Instrument 61-101 - Protection of Minority Security Holders in Special Transactions ("MI 61-101") as AIP currently holders more than 10% of the outstanding voting securities of the Company. In respect of the amended loan and the issuance of the Bonus Shares, the Company relies on the exemption from the formal valuation requirement contained in Section 5.5(b) of MI 61-101 as none of the Company's shares trade on the enumerated exchanges. In respect of the amended loan, the Company relies on the exemption from minority shareholder approval contained in Section 5.7(1)(f) of MI 61-101 as the amended loan is on reasonable terms that are no less advantageous to the Company than if it were to be obtained from an arm's length party, and the amended loan is not convertible into or repayable by the issuance of equity of voting securities of the Company. In respect of the issuance of the Bonus Shares, the Company relies on the exemption from minority shareholder approval contained in Section 5.7(1)(a) of MI 61-101 in that the fair market value of the Bonus Shares does not exceed 25% of the Company's market capitalization as determined under MI 61-101.
The Company did not file a material change report 21 days before closing as all definitive documentation in respect of the transaction was not finalized until shortly prior to the closing, and the Corporation wished to close on an expedited basis for business reasons.
Early Warning Disclosure
In connection with the issuance of the Bonus Shares, AIP acquired ownership, control or direction over common shares of the Company requiring disclosure pursuant to the early warning requirements of applicable securities regulation.
Immediately prior to the issuance of the Bonus Shares, AIP held 2,989,873 common shares of the Company, representing approximately 27.93% of the Company's issued and outstanding common shares. Following the issuance of the Bonus Shares, AIP now holds 3,633,391 common shares of the Company, representing approximately 32.01% of the Company's issued and outstanding common shares.
The Company understands that AIP holds the Bonus Shares for investment purposes. In the future, AIP, may acquire and/or dispose of common shares through the market, privately or otherwise, as circumstances or market conditions may warrant.
This portion of this news release is issued pursuant to National Instrument 62-103 - The Early Warning System and Related and Take-Over Bid and Insider Reporting Issues of the Canadian Securities Administrators, which also requires an early warning report to be filed with the applicable securities regulators containing additional information with respect to the foregoing matters. A copy of the early warning report will be filed by AIP in accordance with applicable securities laws and will be available on the Company's issuer profile on SEDAR at www.sedar.com. The registered office of the Company is at 1100 René-Lévesque Boulevard West, Suite 700, Montreal, Quebec, H3B 4N4.
About Elixxer Ltd. (www.Elixxer.com)
Elixxer is a Canadian public company listed on the TSX Venture Exchange (TSXV: ELXR) and the US OTC Pink exchange (OTC Pink: ELIXF).
Through its partners, Elixxer presently has significant interests in Australia, Jamaica, Switzerland, Italy and Canada.
For further information please contact:
Ferras Zalt, Chairman and Interim CEO: +44 20 7409 6680; firstname.lastname@example.org
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 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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