Vicinity Motor Corp. (TSX-V:VMC) told investors it plans to raise gross proceeds of approximately US$17 million through an underwritten public offering of 3,990,610 units at US$4.26 each.
The Vancouver, British Columbia-based company said it plans to use the net proceeds from the offering for the US$12 million portion of the license fee payable to Optimal-Electric Vehicles, with the remainder going towards general corporate purposes, including new product development and certifications, new product demonstration models, expansion of production capacity and general working capital.
In an October 6 announcement, the company said it signed a licensing and marketing agreement partnering with Optimal-EV to serve as the exclusive North American distributor of its all-electric product line through Vicinity's wide dealer network.
READ: Vicinity Motor enters EV cutaway market in strategic partnership with Optimal-EV
Each unit included in the public offering consists of one common share and one-half of a common share purchase warrant. Each warrant will entitle the holder to buy one share at an exercise price of US$5.10, subject to adjustment in certain circumstances. The warrants will be exercisable immediately upon issuance and will expire three years from the issuance date, the company said.
Spartan Capital Securities LLC is acting as sole book-running manager for the offering and Revere Securities LLC is the exclusive selling group member.
Spartan Capital will receive underwriting commissions equal to 7% of the gross proceeds raised in the offering, which will be equal to approximately US$1.19 million, it added.
The offering is expected to close on or about October 25, 2021, subject to the satisfaction of customary closing conditions.
Vicinity Motor is a leading North American supplier of electric vehicles for both public and commercial enterprise use. It leverages a continent-wide dealer network and close relationships with world-class manufacturing partners to supply its market-leading flagship electric, CNG and clean-diesel Vicinity buses, the VMC 1200 electric truck and a Vicinity Optimal-EV shuttle bus.
In addition, it sells its proprietary electric chassis to JB Poindexter subsidiary EAVX, the company's strategic partner, for upfitting into next-generation delivery vehicles.
Contact the author at stephen.gunnion@proactiveinvestors.com