Elixxer Provides Corporate Update

Rhea-AI Summary

Elixxer Ltd. (TSXV: ELXR) provided a comprehensive corporate update addressing several key developments. The company's Failure-to-File Cease Trade Orders have been revoked as of April 17, 2025, with trading expected to resume shortly. Elixxer has appointed new leadership, including CEO Karim Mecklai and CFO Fiona Fitzmaurice, along with a refreshed board of directors.

The company has restructured its debt obligations, including extending the maturity of $8 million in secured notes plus $3.8M in accrued interest to September 30, 2025. Additionally, Elixxer secured a $1 million bridge loan facility from AIP Fund, its largest creditor and 32% shareholder. The company maintains a 19.36% stake in Freia Farmaceutici and is actively pursuing merger and acquisition opportunities while managing ongoing litigation with Tricho-Med Corporation.

Positive

• Cease trade orders have been revoked, allowing trading to resume
• Secured $1 million bridge loan facility for operational expenses
• Successfully extended $8M note maturity to September 30, 2025
• Maintains valuable 19.36% equity stake in Freia Farmaceutici
• New management team and board of directors in place

Negative

• Significant debt burden with $8M in notes plus $3.8M accrued interest
• No current operating business or revenue generation
• Ongoing litigation with Tricho-Med Corporation
• Dilution of Freia ownership stake from 22.31% to 19.36%
• High interest rates on new bridge loan (up to 24%)

Toronto, Ontario--(Newsfile Corp. - July 4, 2025) - Elixxer Ltd. (TSXV: ELXR) ("Elixxer" or the "Company") is pleased to provide a corporate update to its shareholders.

Failure-to-File Cease Trade Revocation

The Company's shares were cease traded on May 8, 2023, when the Autorité des Marches Financiers ("AMF") and the Ontario Securities Commission ("OSC") issued Failure-to-File Cease Trade Orders against it as a result of the Company not filing various continuous disclosure documents. As announced on April 17, 2025, the cease trade orders have now been revoked, and it is expected that the Company's shares will be re-instated for trading shortly.

The Company's continuous disclosure obligations are now up to date, including its fiscal 2024 audited financial statements and management discussion & analysis (the "MD&A") and first quarter of 2025 financial statements and MD&A. These are available under the Company's profile on SEDAR+.

Annual and Special Meeting of Shareholders ("AGM") held on March 20, 2025

The Company held its AGM on March 20, 2025, where all matters submitted to shareholders, as set out in its Notice of Meeting and Management Information Circular ("MIC") dated February 10, 2025 and filed on SEDAR+, were approved by an overwhelming majority of votes cast at the meeting, including the adoption of the Company's new rolling 10% stock option plan (the "Plan").

The Plan is a rolling 10% plan, and it aligns with certain revisions made to TSX Venture Exchange (the "TSX-V") Policy 4.4 - Security Based Compensation ("Policy 4.4"), which came into effect on November 24, 2021. Particulars of the Plan can be found in the Company's MIC, which, has been filed on the Company's profile on SEDAR+ at www.sedarplus.ca

Management and Directors

In the past several months, the Company appointed a new Chief Executive Officer and Chief Financial Officer as follows:

Karim Mecklai, Chief Executive Officer	- (see press release dated November 28, 2024)
Fiona Fitzmaurice, Chief Financial Officer	- (see press release dated December 12, 2024)

 

As detailed in the Company's March 25, 2025 press release, Elixxer's shareholders appointed the following persons as directors of the Company at its AGM:

Alexey (Alex) Kanayev	- Chairman of the Board
Ferras Zalt	- member of the Audit Committee
Jayahari Balasubramaniam
Mark Romano	- member of the Audit Committee
Edward Milewski	- member of the Audit Committee

Additional information on the Company's directors is provided in the MIC filed on SEDAR+.

Outstanding Loans

Further to the Company's press releases of August 28, 2020 and May 25, 2022, the Company, AIP Asset Management Inc. (the "Security Agent") and AIP Convertible Private Debt Fund L.P. ("AIP Fund") (together with the Security Agent, "AIP"), entered into amending agreements as of April 30, 2024, November 30, 2024 and May 15, 2025 amending the terms of the issued and outstanding 24-month, 17% secured promissory notes (the "Notes") in the principal amount of $8,000,000, plus accrued interest of roughly $3.8M, to extend the maturity date of the Notes to September 30, 2025.

Bridge Loan

The Company announced on June 11, 2025, an unsecured promissory grid note (the "Note") to AIP Fund, its largest creditor and shareholder, owning approximately 32% of Elixxer's common shares, and therefore 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 Company wishes to provide this additional information about the Note. The Note was used to reimburse the $150,000 unsecured bridge loan advanced by AIP on February 6, 2025 and maturing on June 30, 2025, as well as being utilized for future general and administrative expenses. The annual interest rate will not exceed 24%, including the rate applicable in the event of default. The Company's current draw down on the Note is $265,000 leaving up to $735,000 to support the Company's ongoing expenses and maintain ongoing capital requirements established by the TSX-V. The issuance of the Note remains subject to receipt of all necessary corporate and regulatory approvals, including the acceptance of the TSX-V.

Company Operations

The Company's future plans are to identify an operating business to merge into and grow the Company. At the date of this press release, the Company is actively pursuing merger and acquisition opportunities, although no agreements have been entered into, and no letters of interest have been issued.

Freia Farmaceutici Srl ("Freia) Investment

On May 16, 2019, the Company announced that it has entered into a definitive investment agreement to acquire a 35% equity interest in Freia for a total cash consideration of EUR3,214,000 ($4,847,033). The investment was subsequently reduced to reflect two tranches versus the three originally contemplated for an overall revised investment amount equal to EUR1,714,0000 ($2,576,701). The Company completed the first tranche of EUR1,000,000 ($1,513,354) on May 16, 2019, while it completed the second and final tranche of EUR714,000 ($1,063,347) on June 27, 2019, bringing its equity interest in Freia to 22.31%. The Company has appointed a representative to Freia's board of directors. In May 2020, the Company's equity interest in Freia decreased from 22.31% to 19.36% due to additional financing raised by Freia from investors other than Elixxer.

Tricho-Med Corporation Litigation Update

The Company would like to provide an update on its ongoing litigation with Tricho-Med Corporation ("Tricho-Med"). On July 12, 2019, the Company announced that it had received a motion for a declaratory judgement whereby Tricho-Med was seeking the cancellation of the convertible debenture (the "Debenture") it entered into with the Company in December of 2017 and to repay the entire amount advanced by the Company representing four million dollars plus the interest accrued thereon.

In October 2020, the Company filed an application with the Superior Court of Quebec for surrender and taking in payment of Tricho-Med's immovable property pledged as security under the Debenture. The Company was advised by legal counsel that the application would be heard by the Superior Court of Quebec in April 2026.

On April 21, 2021, Tricho-Med submitted a counterclaim against the Company seeking $500,000 in damages for allegedly reclaiming its security. The Company believes that this counterclaim has no merit, lacking sufficient evidence or specificity, and accordingly no amounts have been accrued related to this counterclaim.

In October 2024, a subcontractor of Tricho-Med holding a legal hypothec filed a claim to enforce the judicial sale of the immovable property. The Superior Court of Quebec subsequently ordered the sale to satisfy claims by secured creditors. As of December 31, 2024, the property had not yet been sold. Upon sale, the Company's hypothec will convert into a personal monetary claim without impacting the amount recoverable. The Company also retains the right to challenge the sale if it is conducted below market value.

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/257836

FAQ

What caused Elixxer (TSXV: ELXR) shares to be cease traded and when will trading resume?

Elixxer shares were cease traded on May 8, 2023, due to failure to file various continuous disclosure documents. The cease trade orders were revoked on April 17, 2025, and trading is expected to resume shortly.

How much debt does Elixxer currently have with AIP Fund?

Elixxer has $8 million in secured notes plus approximately $3.8 million in accrued interest due to AIP Fund, with maturity extended to September 30, 2025. Additionally, they secured a new $1 million bridge loan facility.

Who are the new key executives at Elixxer as of 2025?

Elixxer appointed Karim Mecklai as CEO (November 2024) and Fiona Fitzmaurice as CFO (December 2024), along with Alexey Kanayev as Chairman of the Board.

What is Elixxer's ownership stake in Freia Farmaceutici?

Elixxer owns a 19.36% stake in Freia Farmaceutici, reduced from 22.31% due to additional financing raised by Freia from other investors in May 2020.

What is the status of Elixxer's litigation with Tricho-Med Corporation?

The litigation involves a dispute over a $4 million convertible debenture from 2017. Tricho-Med seeks cancellation and repayment, while Elixxer filed for property surrender. A $500,000 counterclaim by Tricho-Med is pending, with court proceedings expected in April 2026.