Lion Electric reports financing transactions for gross proceeds of $142M

The Lion Electric Company announced that the company has entered into subscription agreements with investors contemplating concurrent financing transactions for aggregate gross proceeds to the company of approximately $142M. The Financing consists of (i) the issuance by way of private placement of 13% senior unsecured convertible debentures for aggregate gross proceeds to the company of approximately $74M to a group of subscribers comprised of Investissement Quebec, Fonds de solidarite des travailleurs du Quebec and Fondaction, (ii) the issuance by way of private placement of 11% senior secured non-convertible debentures for aggregate gross proceeds to the company of C$90M to a group of subscribers led by Mach Group and the Mirella & Lino Saputo Foundation, and (iii) the issuance 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 C$2.81 per share for the period described below. The company intends to use the net proceeds from the Financing to fund working capital, strengthen its financial position, and allow it to continue to pursue its growth strategy, including the company’s capacity expansion projects in Mirabel, Quebec and Joliet, Illinois. 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 and the New York Stock Exchange and other customary closing conditions. 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. In connection with the closing of the Financing, the company will terminate its at-the-market equity program which was set to expire in July 2024 and no longer make any sales thereunder.