공고 • Jul 18
The Lion Electric Company announced that it expects to receive CAD 187.78582 million in funding from Investissement Québec, Investment Arm, Fondaction, Fonds de solidarité FTQ,
The Lion Electric Company announced that it has entered into an agreement to issue 13% senior unsecured convertible debentures for aggregate gross proceeds of CAD 97,785,820 and 11% senior secured non-convertible debentures for aggregate gross proceeds of CAD 90,000,000; aggregate gross proceeds of CAD 187,785,820 on July 17, 2023. The 13% convertible debentures investors will include Investissement Québec, Investment Arm, Fonds de solidarité FTQ and Fondaction. The 11% senior secured non-convertible debentures was led by Mach Group and the Mirella & Lino Saputo Foundation. The company also issued by way of private placement to the holders of Non-Convertible Debentures of a number of common share purchase warrants entitling them to purchase a total of 22,500,000 common shares in the capital of the company at an exercise price of CAD 2.81 per share. The Financing is expected to close on or about July 19, 2023 or such other date as determined by the Company and the subscribers, subject in each case to the approval of the Toronto Stock Exchange ("TSX") and the New York Stock Exchange ("NYSE") and other customary closing conditions. The Convertible Debentures will bear interest at the rate of 13% per annum. The Convertible Debentures will mature on the date that is five years following the issuance thereof and will be convertible at the holders' option, at any time after the earlier of the date on which the Company obtains Securityholder Approval, or the third month after the issue date, into Common Shares at a conversion price of CAD 3.40929 per Common Share. The conversion price will be subject to customary adjustments, including for share splits or consolidation, share dividends, rights offerings, asset or other distributions and above market repurchases of shares, in each case in compliance with the rules and requirements of the TSX relating to anti-dilution mechanisms. The Convertible Debentures will contain customary covenants and events of default for an instrument of its nature, in addition to certain covenants relating to maintaining the current headquarter, employees and facilities of the Company in the province of Québec and certain covenants relating to the incurrence of capital expenditures. Upon the occurrence of an event of default or, if later, at the expiry of any agreed-upon period for curing an event of default, as the case may be, holders of Convertible Debentures will have the right, upon giving written notice to the Company, to require the Company to redeem all of the Convertible Debentures, or require that the principal amount of the Convertible Debentures, plus any accrued, compounded and unpaid interest, be converted into Common Shares, in accordance with a customary grid-based "make-whole" adjustment. In connection with the Financing, the Company has agreed to issue a number of Common Shares to each holder of Convertible Debentures equivalent to 0.75% of the principal amount of Convertible Debentures subscribed by each holder, based on the 5-day volume weighted average trading price of the Common Shares on the NYSE immediately prior to announcement of the Financing. Pursuant to applicable Canadian securities laws, the Convertible Debentures and the Closing Fee Shares will be subject to a hold period of four months and one day from closing of the Financing. The Non-Convertible Debentures will bear interest at the rate of 11% per annum and will be payable in cash quarterly. The Non-Convertible Debentures will mature on the date that is five years following the issuance thereof. The Non-Convertible Debentures will constitute senior secured obligations of the Company. In connection with the Financing, the Company has agreed to issue to holders of Non-Convertible Debentures common share purchase warrants entitling them to purchase, at any time after six (6) months following the issuance thereof until the date that is five years following the issuance thereof, 22,500,000 Common Shares in the aggregate at an exercise price of CAD 2.81 per Common Share. The exercise price of the Warrants will be subject to customary adjustments, including for share splits or consolidation, share dividends, rights offerings, asset or other distributions and above market repurchases of shares (including above market exchanges or tender offers), in each case in compliance with the rules and requirements of the TSX relating to anti-dilution mechanisms. Upon the occurrence of a change of control of the Company, the Company will have the right to redeem all of the outstanding Warrants for a cash purchase price based on the remaining term of the Warrants and the value of the consideration offered or payable per Common Share in the transaction constituting the change of control. Pursuant to applicable Canadian securities laws, the Warrants will be subject to a hold period of four months and one day from closing of the Financing. Closing of the Financing will not require securityholder approval under the rules of the TSX since the Convertible Debentures and the Warrants will include "blocker" provisions to ensure that, unless securityholder approval is obtained in accordance with the rules of the TSX, the aggregate number of Common Shares issuable in connection with the Financing cannot be greater than 25% of the number of Common Shares outstanding, on a non-diluted basis, prior to the date of closing of the Financing. In addition, no insider of the Company has any direct or indirect interest in the Financing. The Financing was negotiated at arm's length with the subscribers thereunder. In light of the Conversion Caps and assuming no change in the number of Common Shares issued and outstanding until closing of the Financing, unless Securityholder Approval is obtained, 258,155 Closing Fee Shares will be issued at closing and 56,223,539 Common Shares would be issuable upon conversion of the Convertible Debentures and exercise of the Warrants in accordance with their terms, representing in the aggregate 25% of the number of Common Shares outstanding, on a non-diluted basis, as of the date hereof. As a result, the Company will seek approval from the shareholders of the Company for the issuance by the Company of up to 89,392,256 Common Shares in connection with the Financing, representing more than 25% of the number of Common Shares outstanding, on a non-diluted basis, prior to the date of closing of the Financing, which requires securityholder approval in accordance with Section 607(g)(i) of the Company Manual. Concurrent with closing of the financing, the Company will amend its senior credit facilities to, among other things, permit the incurrence of the Financing and
extend the maturity of its senior credit facilities by one year to August 11, 2025.