Viridis Energy Secures $3.25 Million Term Loan and $250,000 Credit Line from Royal Bank of Canadaadmin
Vancouver, BC – / ACCESSWIRE / March 4, 2014 / Viridis Energy Inc. (“Viridis” or the “Company”) (TSXV: VRD), a “Cleantech” manufacturer and distributor of renewable energy providing waste biomass fuel to global residential and industrial markets, announced today that its wholly owned subsidiary, Okanagan Pellet Company Inc. (“OPC”), has entered into a loan facilities agreement providing for a $3.25 million secured loan (the “Loan”) with the Royal Bank of Canada (“RBC”). The loan bears interest at the annual rate of Royal Bank’s prime rate plus 3% (currently equates to approximately 6%), payable monthly over 48 months. Proceeds from the Loan will be primarily used to repay the Company’s debt held by Cornwall Investments LLC, which bears interest costs of 9% per year (prime plus 6%). In addition, RBC will provide the Company with a $250,000 line of credit at Royal Bank’s prime rate plus 3% interest per annum, for general working capital purposes.
The Loan is secured by a first ranking security interest in all present and after acquired personal property of Okanagan Pellet Company Inc. and equipment financed through the Loan and has no prepayment or repayment penalties. The Loan requires that OPC maintain a debt service coverage (the amount of cash flow available to meet annual interest payments on the debt) of not less than 1.25 to 1, calculated over the last twelve months and a ratio of total liabilities to tangible net worth of not more than 2 to 1, calculated quarterly. No securities of the Company are or will be issued in connection with the Loan.
Robert Aaron, Chairman of the Board of Viridis Energy, commented, “Viridis received the critical funding from Cornwall in its early development stage. The Company has now entered an accelerated growth phase as its second plant, Scotia Atlantic Biomass, has begun shipping product, and its Merchants group has begun generating revenue. We intend to extend our commitment to Viridis by exercising warrants, as OPC repays the Cornwall loan. We will exercise warrants to purchase 15 million common shares, at $0.15, which will add $2.25 million to Viridis’ working capital, and thus strengthen its position in the market as an emerging leader in the global wood pellet market.”
Viridis Investor Contact:
Yvonne L. Zappulla
Grannus Financial Advisors, Inc.
Chief Financial Officer
Viridis Energy Inc
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About Viridis Energy Inc.
Viridis Energy Inc. (TSXV: VRD) is a publicly traded, “Cleantech” alternative energy company specializing in the agricultural and wood waste biomass. Located in Vancouver, B.C., Viridis Energy operates Cypress Pacific Marketing, Okanagan Pellet Company and Scotia Atlantic Biomass, thus providing the Company with vertical integration for distribution and manufacturing as well as coast to coast national presence. For more information on Viridis Energy Inc. please refer to the Company’s website at www.viridisenergy.ca.
About Royal Bank of Canada
Royal Bank of Canada is Canada’s largest bank, and one of the largest banks in the world, based on market capitalization. We are one of North America’s leading diversified financial services companies, and provide personal and commercial banking, wealth management services, insurance, investor services and capital markets products and services on a global basis. We employ approximately 79,000 full- and part-time employees who serve more than 16 million personal, business, public sector and institutional clients through offices in Canada, the U.S. and 42 other countries. For more information, please visit rbc.com.
Certain statements in this release are forward-looking statements, which reflect the expectations of management regarding the Company’s future operations. Forward-looking statements consist of statements that are not purely historical, including any statements regarding beliefs, plans, expectations or intentions regarding the future. Such statements are subject to risks and uncertainties that may cause actual results, performance or developments to differ materially from those contained in the statements. No assurance can be given that any of the events anticipated by the forward-looking statements will occur or, if they do occur, what benefits the Company will obtain from them. These forward-looking statements reflect management’s current views and are based on certain expectations, estimates and assumptions which may prove to be incorrect. A number of risks and uncertainties could cause our actual results to differ materially from those expressed or implied by the forward-looking statements, including: (1) a continued downturn in general economic conditions in North America and internationally, (2) the inherent uncertainties associated with the demand for biofuels, (3) the risk that the Company does not execute its business plan, (4) inability to finance operations and growth (5) inability to finance the start-up operations in Nova Scotia in a timely manner (6) inability to retain key management and employees, (7) an increase in the number of competitors with larger resources, and (8) other factors beyond the Company’s control. These forward-looking statements are made as of the date of this news release and the Company intends to update such forward looking information in the Company’s MD&A in the event that actual results differ materially from such forward-looking statements contained herein. Additional information about these and other assumptions, risks and uncertainties are set out in the “Risks and Uncertainties” section in the Company’s MD&A filed with Canadian securities regulators.
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.
Posted: March 4th, 2014 under ACCESSWIRE.