Elixxer entered into a loan agreement with AIP Convertible Private Debt Fund for a secured loan in the principal amount of C$4 million ($3.06 million).
The loan will have a term of 24 months and will bear interest at the rate of 17% per annum. The loan will be secured by a general security agreement on all of the present and after-acquired property of Elixxer
On closing, Elixxer will pay to the lender a facility fee of C$200,000 ($153,030), a closing fee of C$250,000 ($191,290) and a monitoring fee of C$75,000 ($57,390), in respect of the loan. Upon approval of the TSX Venture Exchange, the lender also shall receive a bonus of 46,333,333 common shares of the company at a deemed issue price of C$0.015 ($0.011) per share, representing 20% of the net amount of the loan.
Elixxer intends to use the proceeds of the loan for working capital purposes and to pursue future investments.
Elixxer also completed a proposed non-brokered private placement with a strategic investor in the amount of $400,000 (C$522,800) for 34,853,333 units of the company at a price of C$0.015 ($0.011) per unit. Each unit will consist of one common share of the company and one common share purchase warrant. Each warrant will be exercisable for a period of 60 months from the date of issuance at an exercise price of C$0.05 ($0.038) each.
No commission or finder’s fee will be paid in connection with the private placement. The units will be issued pursuant to an exemption from the prospectus requirements of applicable securities legislation, and all securities will be subject to a hold period of four months and one day from the date of issuance.
Elixxer will use the proceeds of the private placement for general working capital purposes. Closing of the private placement is subject to approval of the TSXV and to customary closing conditions.
“We are very pleased to be working with AIP,” Mazen Haddad, CEO of Elixxer, said. “This financing is intended to allow Elixxer to execute on our acquisition strategy, which will target growth companies with revenues and cash flows.”
