Monday, 10 March 2014 07:46

Viridis Energy Secures $3.25 Million Term Loan and $250,000 Credit Line from Royal Bank of Canada

img logoViridis Energy Inc. 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.

vir ban

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."

Additional Info

About Viridis Energy Inc.

Viridis Energy Inc 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 www.rbc.com

Viridis Investor Contact:

Yvonne L. Zappulla

Managing Director

Grannus Financial Advisors, Inc.

212-681-4108

This email address is being protected from spambots. You need JavaScript enabled to view it.

Company Contact:

Michele Rebiere

Chief Financial Officer

Viridis Energy Inc

905-847-5226

This email address is being protected from spambots. You need JavaScript enabled to view it.

Read 6788 times