Elixxer Announces Bridge Loan

Rhea-AI Summary

Elixxer Ltd. has secured a bridge loan through an unsecured promissory grid note for up to $1,000,000 from a non-arm's length lender. The loan matures on December 31, 2025, with a 24% annual interest rate, increasing to 34% upon default. The transaction constitutes a related party transaction as the lender is a control person of the company. Elixxer is utilizing financial difficulty exemptions from valuation and minority shareholder approval requirements. The loan was approved by independent board members, excluding Alexey Kanayev and Jayahari Balasubramaniam. The issuance remains subject to TSX Venture Exchange approval.

Positive

• Access to immediate funding of up to $1,000,000 to improve company's financial position
• Loan approved by independent board members showing internal support

Negative

• High interest rate of 24% annually, increasing to 34% upon default
• Related party transaction with control person indicates potential difficulty securing external funding
• Company acknowledges being in financial difficulty

Toronto, Ontario--(Newsfile Corp. - June 11, 2025) - Elixxer Ltd. (TSXV: ELXR) ("Elixxer" or the "Company") announces it has issued an unsecured promissory grid note (the "Note") to a non-arm's length lender (the "Lender") of the Company for available proceeds to the Company of up to $1,000,000 (the "Loan"). The Loan shall mature on December 31, 2025 (the "Term"). The Company may draw on the available proceeds of the Note from time to time during the Term, and the amounts outstanding under the Note bears interest of 24% per annum payable with any outstanding principal due at the end of the Term, and the interest increases to 34% per annum upon an event of default.

The issuance of the Note remains subject to receipt of all necessary corporate and regulatory approvals, including the approval of the TSX Venture Exchange.

The issuance of the Note constitutes a related party transaction within the meaning of TSX Venture Exchange Policy 5.9 and Multilateral Instrument 61-101 - Protection of Minority Security Holders in Special Transactions ("MI 61-101") as the Lender is a control person of the Company. The Company is relying on the exemptions from the valuation and minority shareholder approval requirements of MI 61-101 contained in sections 5.5(g) and 5.7(1)(e) of MI 61-101, as the Company is in financial difficulty and the transaction is designed to improve the financial position of the Company, as determined in accordance with MI 61-101. The Company did not file a material change report in respect of the related party transaction at least 21 days before the issuance of the Note, which the Company deems reasonable.

The Loan was approved by the members of the board of directors of the Company who are independent for the purposes of the Loan, being all directors other than Messrs. Alexey (Alex) Kanayev and Jayahari (Jay) Balasubramaniam. No special committee was established in connection with the Note, and no materially contrary view or abstention was expressed or made by any director of the Company in relation thereto.

This press release does not constitute an offer to sell or a solicitation of an offer to buy the securities in the United States. The securities have not been and will not be registered under the United States Securities Act of 1933, as amended (the "U.S. Securities Act") or any state securities laws and may not be offered or sold within the United States or to U.S. Persons as defined under applicable United States securities laws unless registered under the U.S. Securities Act and applicable state securities laws or an exemption from such registration is available.

About Elixxer Ltd.

Elixxer is a Canadian public company listed on the TSX Venture Exchange (TSXV: ELXR) and the US OTC-Pink exchange (OTC Pink: ELIXF). Elixxer is an investment company with investments in Canada and other countries and is currently looking for new high growth opportunities to invest in.

For further information, please contact:

Karim Mecklai, Chief Executive Officer, 416-877-3153

Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

This news release contains certain "forward-looking information" within the meaning of applicable securities laws. Forward-looking information is frequently characterized by words such as "plan", "expect", "project", "intend", "believe", "anticipate", "estimate", "may", "will", "would", "potential", "proposed" and other similar words, or statements that certain events or conditions "may" or "will" occur. These statements are only predictions. Forward-looking information is based on the opinions and estimates of management at the date the information is provided, and is subject to a variety of risks and uncertainties and other factors that could cause actual events or results to differ materially from those projected in the forward-looking information. For a description of the risks and uncertainties facing the Company and its business and affairs, readers should refer to the Company's Management's Discussion and Analysis. The Company undertakes no obligation to update forward-looking information if circumstances or management's estimates or opinions should change, unless required by law. The reader is cautioned not to place undue reliance on forward-looking information.

To view the source version of this press release, please visit https://www.newsfilecorp.com/release/255249

FAQ

What are the terms of Elixxer's (ELIXF) bridge loan announced on June 11, 2025?

The bridge loan is for up to $1,000,000, matures on December 31, 2025, with 24% annual interest rate, increasing to 34% upon default.

Why did Elixxer (ELIXF) secure a loan from a related party?

The company is in financial difficulty and the transaction is designed to improve its financial position, suggesting potential challenges in securing external funding.

Who approved the bridge loan for Elixxer (ELIXF)?

The loan was approved by independent board members, excluding Alexey Kanayev and Jayahari Balasubramaniam, as it constitutes a related party transaction.

What regulatory approvals are needed for Elixxer's (ELIXF) bridge loan?

The loan issuance requires TSX Venture Exchange approval and relies on exemptions from MI 61-101 requirements due to financial difficulty.

What is the interest rate on Elixxer's (ELIXF) bridge loan?

The loan carries a 24% annual interest rate, which increases to 34% per annum upon an event of default.