Electric Royalties Announces Commitment Letter To Increase Convertible Credit Facility to C$10 Million on Improved Terms, Takes Drawdown
Electric Royalties Announces Commitment Letter To Increase
Convertible Credit Facility to C$10 Million on Improved Terms,
Takes Drawdown
VANCOUVER, BC / ACCESSWIRE / October 19, 2023 / Electric Royalties Ltd.
(TSXV:ELEC)(OTCQB:ELECF) ("Electric Royalties" or the "Company") is pleased to
announce, further to its April 20, 2023, January 19, 2023 and November 16, 2022 news releases,
that it has signed a commitment letter with Gleason & Sons LLC (the "Lender") to increase the
Company's existing convertible credit facility from C$5,000,000 to C$10,000,000 (the "Loan
Amendment"). Gleason & Sons LLC is controlled by Stefan Gleason, a significant shareholder
and Board Observer of Electric Royalties.
The credit facility will be secured by: (i) a portion of the Company's existing royalty portfolio
(1.5% Gross Revenue Royalty on the Penouta Mine in Spain, 0.5% Gross Revenue Royalty on
the Kenbridge nickel project in Canada, the sliding scale Gross Metals Royalty on the Middle
Tennessee Mine in the United States, 0.5% Gross Metal Royalty on the Authier lithium project
in Canada and 1.5% Gross Revenue Royalty on the Bissett Creek graphite project in Canada);
and (ii) a lien against the Company's present and future rights in additional royalties acquired
using funds advanced under the credit facility, if any.
The Lender has also agreed to extend the Maturity Date of the loan from January 12, 2026 to
January 12, 2028. All other terms of the credit facility remain the same.
Meanwhile, the Company has elected to draw down C$500,000 under the convertible credit
facility (the "Drawdown") for working capital.
Brendan Yurik, CEO of Electric Royalties, commented: "We once again thank our largest
shareholder Stefan for his ongoing and long-term support of Electric Royalties. The
additional $5 million in credit that he is providing, with a favorable term and rate, speaks
to his belief in the mandate of the Company, which is to grow shareholder value by
enabling the development of metal assets the world critically needs to achieve electrification
and transition away from fossil fuels. Access to this credit facility means that Electric
Royalties is able to continue pursuing its near-term goal of becoming cashflow positive
through the acquisition of additional producing royalties, without diluting shareholders at
current share prices."
Stefan Gleason, Managing Director of Gleason & Sons, commented: "We are pleased to help
Electric Royalties capitalize on today's especially fertile environment to acquire
undervalued royalties. As a shareholder, I applaud Brendan and the Company's board for
having kept overhead costs so low while continuing to execute on their business plan - and
without dilutive equity financings whilst Electric Royalties' market valuation appears so
far below fair value."
The Credit Facility is a "related party transaction" within the meaning of Multilateral Instrument
61-101 Protection of Minority Security Holders in Special Transactions ("MI 61-101"). The
Credit Facility is exempt from the valuation requirement of MI 61-101 by virtue of the
exemption contained in section 5.5(b) as the Company's common shares are not listed on a
specified market and from the minority shareholder approval requirements of MI 61-101 by
virtue of the exemption contained in section 5.7(a) of MI 61-101 in that the fair market value of
Credit Facility does not exceed 25% of the Company's market capitalization.
The Loan Amendment and the Drawdown are subject to completion of documentation, the
approval of the TSX Venture Exchange and other customary closing conditions.
About Electric Royalties Ltd.
Electric Royalties is a royalty company established to take advantage of the demand for a wide
range of commodities (lithium, vanadium, manganese, tin, graphite, cobalt, nickel, zinc and
copper) that will benefit from the drive toward electrification of a variety of consumer products:
cars, rechargeable batteries, large scale energy storage, renewable energy generation and other
applications.
Electric vehicle sales, battery production capacity and renewable energy generation are slated to
increase significantly over the next several years and with it, the demand for these targeted
commodities. This creates a unique opportunity to invest in and acquire royalties over the mines
and projects that will supply the materials needed to fuel the electric revolution.
Electric Royalties has a growing portfolio of 22 royalties, including two royalties that currently
generate revenue. The Company is focused predominantly on acquiring royalties on advanced
stage and operating projects to build a diversified portfolio located in jurisdictions with low
geopolitical risk, which offers investors exposure to the clean energy transition via the
underlying commodities required to rebuild the global infrastructure over the next several
decades towards a decarbonized global economy.
For further information, please contact:
Brendan Yurik
CEO, Electric Royalties Ltd.
Phone: (604) 364‐3540
Email: [email protected]
www.electricroyalties.com
Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined
in the policies of the TSX Venture Exchange), nor any other regulatory body or securities
exchange platform, accepts responsibility for the adequacy or accuracy of this release.
Cautionary Statements Regarding Forward-Looking Information and Other Company
Information
This news release includes forward-looking information and forward-looking statements
(collectively, "forward-looking information") with respect to the Company within the meaning of
Canadian securities laws. This news release includes information regarding other companies
and projects owned by such other companies in which the Company holds a royalty interest,
based on previously disclosed public information disclosed by those companies and the
Company is not responsible for the accuracy of that information, and that all information
provided herein is subject to this Cautionary Statement Regarding Forward-Looking Information
and Other Company Information. Forward looking information is typically identified by words
such as: believe, expect, anticipate, intend, estimate, postulate and similar expressions, or are
those, which, by their nature, refer to future events. This information represents predictions and
actual events or results may differ materially. Forward-looking information may relate to the
Company's future outlook and anticipated events and may include statements regarding the
financial results, future financial position, expected growth of cash flows, business strategy,
budgets, projected costs, projected capital expenditures, taxes, plans, objectives, industry trends
and growth opportunities of the Company and the projects in which it holds royalty interests.
While management considers these assumptions to be reasonable, based on information
available, they may prove to be incorrect. Forward-looking statements involve known and
unknown risks, uncertainties and other factors which may cause the actual results, performance
or achievements of the Company or these projects to be materially different from any future
results, performance or achievements expressed or implied by the forward-looking statements.
These risks, uncertainties and other factors include, but are not limited to risks associated with
general economic conditions; adverse industry events; marketing costs; loss of markets; future
legislative and regulatory developments involving the renewable energy industry; inability to
access sufficient capital from internal and external sources, and/or inability to access sufficient
capital on favourable terms; the mining industry generally, the Covid-19 pandemic, recent
market volatility, income tax and regulatory matters; the ability of the Company or the owners of
these projects to implement their business strategies including expansion plans; competition;
currency and interest rate fluctuations, and the other risks.
The reader is referred to the Company's most recent filings on SEDAR as well as other
information filed with the OTC Markets for a more complete discussion of all applicable risk
factors and their potential effects, copies of which may be accessed through the Company's
profile page at www.sedar.com and at otcmarkets.com.
SOURCE: Electric Royalties Ltd.