GreenPower Motor Company Secures Significant Loan for Growth

GreenPower Motor Company Announces Successful Loan Closure
GreenPower Motor Company Inc. (NASDAQ: GP) has officially completed the third tranche of its secured term loan offering, securing an impressive aggregate principal amount of U.S. $300,000. The company specializes in designing and distributing all-electric, purpose-built, zero-emission vehicles tailored for various sectors, including cargo delivery, transit, and educational transport.
Details of the Loan Agreement
The loan comes as GreenPower enters agreements with lenders, which are entities managed by the company's CEO and a director. The funds obtained from this loan are earmarked for crucial company needs such as production costs, supplier payments, payroll, and overall working capital. This showcases GreenPower's commitment to scaling its operations and maintaining financial stability.
Loan Terms and Conditions
Notably, the loans are secured with a general security agreement against the company's assets and will incur an interest rate of 12% per annum. This interest begins on the date of the loan's closure and will be applicable until all debts associated with the loans are settled, which are planned to have a term of two years.
Incentives for Lenders
As part of the loan arrangement, GreenPower issued 340,909 non-transferable share purchase warrants to one of the lenders. Each warrant confers the right to purchase a common share at an exercise price of $0.44 per share, valid for 24 months following the loan's closing date. Additionally, one lender will receive 68,181 shares as a bonus, further incentivizing their investment.
Compliance and Related Transactions
The lenders involved in this transaction are considered 'related parties' under Canadian regulations. Importantly, these loans qualify as related party transactions, yet they are exempt from certain formal requirements typically applicable to such arrangements. This exception arises from provisions in the regulations, as the fair market value of the transactions does not exceed 25% of the company's overall market capitalization.
Impact of the Loan on Company Operations
Every security issued in relation to this loan will be subject to a statutory hold period of four months plus one day, ensuring compliance with relevant securities legislation. The infusion of capital from this loan is expected to positively impact GreenPower’s production capabilities and operational growth.
Company Overview
GreenPower Motor Company Inc. is committed to revolutionizing the transportation industry through its innovative all-electric vehicles that reduce carbon emissions. The company has established itself as a leader in providing a full suite of electric vehicles, including transit and school buses, shuttles, and cargo vans. With its manufacturing facilities primarily located in Southern California, GreenPower aims to meet diverse operational specifications while ensuring ease of maintenance and high performance for its vehicles.
Future Prospects
As GreenPower continues to grow and adapt to market needs, the latest funding stands to enhance its operating capacity substantially. The management's strategic vision focuses on sustainable mobility solutions, solidifying its position in the electric vehicle sector, and opening doors for further investment and innovation.
Frequently Asked Questions
What is the total amount secured in the loan offering?
The total amount secured in the loan offering is U.S. $300,000.
Who are the lenders involved in the loan agreement?
The lenders involved are companies controlled by GreenPower's CEO and a Director.
What are the main uses of the loan proceeds?
The proceeds from the loan will be allocated to production costs, supplier payments, payroll, and working capital.
How long is the term of the loans?
The term of the loans is set for two years from the closing date.
What are the interest rates on the loans?
The loans will bear an interest rate of 12% per annum.
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