Vicinity Motor Corp. (TSX-V:VMC) has announced the closing of a non-brokered private placement of unsecured convertible debentures for gross proceeds of C$4 million.
Net proceeds from the private placement will be deployed to accelerate vehicle production and deliveries in the company's existing US$150 million order backlog, Vicinity said.
The convertible debentures are issued in denominations of C$1,000, bear interest at 15% per annum, and mature 18 months from the closing date. Interest payments have been deferred to the twelve-month anniversary and/or maturity. Each debenture is convertible at the holder's option into units of the company at any time prior to maturity at a conversion price of C$1.45.
READ: Vicinity Motor to accelerate vehicle deliveries with C$3.6M convertible debenture financing
Upon conversion, each unit will consist of one common share of the company and 0.2 common share purchase warrants. Each whole warrant is exercisable into one common share of the company at an exercise price of C$1.45 for a period of thirty-six months following the closing of the private placement.
All securities issued under the private placement have a hold period of four months and a day from closing. The private placement is subject to final TSX Venture Exchange approval.
In connection with the private placement, Vicinity paid cash commissions to eligible finders, in accordance with TSX Venture Exchange policy, of C$73,500.
Certain insiders of the company participated in the private placement. This participation by insiders constitutes a related party transaction as defined under Multilateral Instrument 61-101 -Protection of Minority Security Holders in Special Transactions.
The convertible debentures issued under the private placement have not, nor will they be registered under the United States Securities Act of 1933, as amended, and may not be offered or sold within the United States or to, or for the account or benefit of, US persons in the absence of US registration or an applicable exemption from the US registration requirements.
Vicinity Motor is a North American supplier of electric vehicles for both public and commercial enterprise use. The company leverages a dealer network and close relationships with world-class manufacturing partners to supply its flagship electric, CNG and clean-diesel Vicinity buses, as well as the VMC 1200 electric truck to the transit and industrial markets.
Contact the author at jon.hopkins@proactiveinvestors.com