RE Royalties Acquires Royalties on 40MW Operational Wind Projects in Nova Scotia and Completes Convertible Note Financing

Source Company Press Release
Company RE Royalties Ltd.
Tags Corporate: Overview/Strategy, Country: Canada, M&A: Asset Deal, Deals, Renewables: Renewables News, Segment: Power
Date February 06, 2020

 RE Royalties Ltd. (TSXV:RE) ("RE Royalties" or the "Company") is pleased to announce that it has acquired a portfolio of 12 gross revenue royalties on 12 operational wind energy generation projects in Nova Scotia, Canada ("Nova Scotia Wind Projects") from Scotian Windfields Inc. ("Scotian Windfields") for $1.34 million. The Company also provided an interest-bearing senior secured loan to Scotian Windfields of $3.3 million dollars with a term of 3 years.

The Nova Scotia Wind Projects were developed from 2013 to 2017 and have been operating for between 3 and 6 years. The Nova Scotia Wind Projects have a generating capacity of 39.7 megawatts, and have 20-year power purchase agreements with fixed electricity purchase prices from Nova Scotia Power Incorporated ("NSPI"). The Nova Scotia Wind Projects generate approximately 130,000 megawatt hours of clean energy per year; capable of removing over 105,000 tonnes of CO2 equivalent (1) from the electricity grid.

Peter Leighton, COO of the Company, commented, "We are pleased to acquire this portfolio of royalties from Scotian Windfields and are excited to be part of Nova Scotia's ongoing efforts to move away from carbon-based electricity to help them achieve their goal of having 40% renewable energy sources by 2020. This transaction demonstrates the strength of RE Royalties' financing model in creating a win-win solution for our clients, shareholders and the environment."

Joe Fitzharris, President of Scotia Windfields Inc. commented, "We are pleased to have RE Royalties help us secure our ownership in these important community projects. Our local shareholders will now have a better opportunity to realize return on their invested capital and securing our long term financial stability will allow us to continue exploring ways to support community development while reducing carbon intensity".

The acquisition of the Nova Scotia Wind Projects increases RE Royalties portfolio from 63 royalties to 75 royalties on solar, wind and hydro projects in Canada, Europe and the United States.

Convertible Note Financing

The Company also issued a series of unsecured, convertible notes ("Convertible Note") totaling $1.6 million to certain arm's-length parties. The Convertible Note shall be convertible into common shares of the Company at a conversion price of $1.00 per share, with a term of 36 months from the date of issue, and bear an annual interest rate of 8% per annum. The Convertible Notes were distributed by Deetken Impact, a Canadian registered exempt market dealer and investment fund manager with a 10-year track record of delivering strong, stable returns to investors by supporting businesses that make a meaningful contribution to the Sustainable Development Goals. Together with its affiliate, Deetken Impact Sustainable Energy, Deetken Impact currently manages $100 million in impact assets. Deetken Impact is a signatory to the UN Global Compact and a certified B Corporation.

"Through our distribution of RE Royalties notes, we are expanding the set of impact investment opportunities for Canadian and global individual investors," said Alexa Blain, Managing Partner of Deetken Impact. "The transaction is well aligned with our business goals of advancing climate action through investment and improving access to affordable, sustainable energy for all communities."

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