Electric Royalties Boosts Convertible Credit Facility To C$5M With Better Terms; Appoints Stefan Gleason As Board Observer

Electric Royalties Ltd (TSX-V:ELEC, OTC:ELECF) announced that it has entered into an agreement with Gleason & Sons LLC, which is controlled by the company’s largest shareholder Stefan Gleason, to increase Electric Royalties’ existing convertible credit facility from C$2 million to C$5 million.

The company said the lender has also agreed to modify the interest rate to a lower, floating rate, with a maximum rate of 12.5%, compared to the original rate of 15%, and to remove the early repayment fee.

“This facility is very friendly towards the company in a number of ways, highlighted by its 3-year term, no structuring fee or setup fee, no early repayment fee, no fees payable on undrawn capital, and no interest payments throughout the entire term of the loan (interest is capitalized into the loan and due at the end of the term), a relatively low SOFR (Secured Overnight Financing Rate) + 7% interest rate, and the loan advances being convertible into shares of Electric Royalties at the greater of 100% of the 30-day VWAP (volume-weighted average price) at the time of each advance or C$0.50 per share, at the election of the lender,” Electric Royalties CEO Brendan Yurik said in a statement.

Electric Royalties also reported that Gleason has been appointed as a board observer to the company effective immediately.

Gleason, majority owner of Money Metals Exchange LLC, will be invited to attend and participate in board meetings and be granted access to all information provided to the board, but he will not have any voting rights, the company said.

As well, Electric Royalties said it has elected to draw down C$500,000 under the convertible credit facility to fund the acquisition of the Kenbridge nickel royalty announced on March 6, 2023.

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.