MONTRÉAL, July 24, 2020 (GLOBE NEWSWIRE) -- Elixxer Ltd. (the “Corporation” or “Elixxer”) (TSX-V: ELXR and OTC-QB: ELIXF) announces that it proposes to settle a total of $8,625,699 of debt owed by the Corporation through the issuance of securities.
The debt to be settled includes $3,000,000 of principal and $964,826 of interest and fees owed to AIP Global Macro Fund LP (“AIP”) pursuant to an existing loan agreement (the “AIP Debt”). The Corporation proposes to settle the AIP Debt by issuing to AIP a total of 198,241,300 common shares at a deemed issue price of $0.02 per share and 198,241,300 common share purchase warrants (the “AIP Debt Settlement”). Each warrant will be exercisable for a period of 60 months from the date of issuance at an exercise price of $0.05 each. AIP currently holds 8,900,000 common shares and 35,000,000 common share purchase warrants of the Corporation. The AIP Debt Settlement will result in AIP becoming a “control person” of Elixxer. Upon completion of the AIP Debt Settlement only, AIP would hold 207,141,300 common shares and 233,241,300 common share purchase warrants of the Corporation, representing approximately 27.30% of the Corporation’s issued and outstanding common shares on an undiluted basis and 44.39% on a partially diluted basis. As such, the AIP Debt Settlement as proposed is subject to the Corporation obtaining shareholder approval which will be sought at the Corporation’s upcoming annual and special meeting of shareholders anticipated to be held in September 2020.
The Corporation also proposes to settle a total of $3,593,004 of principal and $1,067,869 of interest and fees owed to Arlington Capital LP (“Arlington”) pursuant to an existing loan agreement (the “Arlington Debt”). The Corporation proposes to settle the Arlington Debt by issuing to Arlington a total of 233,043,650 common shares at a deemed issue price of $0.02 per share and 233,043,650 common share purchase warrants (the “Arlington Debt Settlement”). Each warrant will be exercisable for a period of 60 months from the date of issuance an exercise price of $0.05 each. The Arlington Debt Settlement will result in Arlington becoming a “control person” of Elixxer. Upon completion of the Arlington Debt Settlement only, Arlington would hold 337,043,650 common shares and 233,043,650 common share purchase warrants, representing approximately 42.47% of the Corporation’s issued and outstanding common shares on an undiluted basis and 55.53% on a partially diluted basis. As such, the Arlington Debt Settlement as proposed is subject to the Corporation obtaining shareholder approval which will be sought at the Corporation’s upcoming annual and special meeting of shareholders anticipated to be held in September 2020. The Arlington Debt Settlement also constitutes a “related party transaction” as such term is defined in Regulation 61-101 respecting Protection of Minority Securityholders in Special Transactions. The Corporation relies on the exemption from the valuation requirement pursuant to subsection 5.5(b) of Regulation 61-101 as the securities of the Corporation are not listed or quoted on enumerated stock exchanges.
Upon completion of both the AIP Debt Settlement and the Arlington Debt Settlement as proposed, the Corporation will have approximately 991,792,982 common shares issued and outstanding with (i) AIP holding approximately 20.89% on an undiluted basis and approximately 35.95% on a partially diluted basis; and (ii) Arlington holding approximately 33.98% on an undiluted basis and approximately 46.54% on a partially diluted basis. Upon completion of both settlements, each of AIP and Arlington will have the right to nominate two members to Elixxer’s Board of Directors, with at least two other members being independent.
The pricing of the common shares issuable pursuant to the debt settlements is in reliance of the temporary relief measures established by the TSX Venture Exchange (the “TSXV”) on April 8, 2020 providing for temporary relief measures to its Policy 4.3, lowering the minimum pricing from $0.05 to $0.01 per share for shares issued pursuant to a debt settlement where the market price of an issuer’s shares is not greater than $0.05. The market price of the Corporation’s common shares at close of business on July 23, 2020 was $0.02.
Completion of the AIP Debt Settlement and the Arlington Debt Settlement as proposed is, in each case, subject to (i) completion of definitive agreements; (ii) approval of the TSXV; and (iii) shareholder approval as outlined above. All securities issued pursuant to the settlement of the AIP Debt Settlement and the Arlington Debt Settlement will be subject to hold period of four months and one day from the date of issuance.
The Corporation is pleased to also announce that following the resignation of David Lenigas yesterday, Mr. Tarik Alhaidary has been appointed as his replacement as a member of Elixxer’s Board of Directors. The Corporation also welcomes Mr. Jeff Cheah who has also been appointed as a director of Elixxer, subject to acceptance by the TSXV.
Mr. Alhaidary is a graduate of the University of Southern California in computer science and computer engineering. Mr. Alhaidary brings a great deal of experience to Elixxer’s Board of Directors. During his 30 years of work experience, he has led several successful investments in the oil and gas and telecom industries. He was the founder and CEO of a mobile telecommunications company that grew to have a large base of subscribers. Mr. Alhaidary currently serves as a board member and Managing Director of Green Investment in Waste to Energy based in the United Kingdom.
Mr. Cheah is a treasury, and risk management professional, specializing in the FX and commodity markets. He has over 20 years of experience in the capital markets, both in the public and private sector. As a former policy maker at the Bank of Canada, Mr. Cheah served in the Financial Markets Department where he contributed to the decision-making process to ensure financial market stability in Canada. In the private sector, Mr. Cheah managed financial market risks and has traded FX and commodities, developing short- and long-term market strategies for corporations, helping with hedge accounting processes and design. Mr. Cheah has served as a member of the Treasury Board of the Markets Technician Association in New York, was a member of the Investment Committee for the Ontario March of Dimes, and the Canadian National Institute for the Blind. He has a BBA in Economics and Finance, is a Chartered Market Technician and has the Certified Risk Manager professional designation from the University of Toronto.
About Elixxer Ltd. (www.elixxer.com)
Elixxer Ltd. is a leading investment firm. Through its growing portfolio of investment companies, ELXR is building a transversal integrated organization of interconnected companies with production, processing and distribution in Australia, Jamaica, Switzerland, Italy, and Canada serving domestic and export markets. Elixxer Ltd. is a Canadian incorporated public company listed on the TSX Venture Exchange (TSX-V: ELXR) and the US OTC-QB exchange (OTCQB: ELIXF).
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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