GreenPower Closes First Tranche of Term Loan Offering
GreenPower Motor Company (Nasdaq: GP) has closed the first tranche of its secured term loan offering, raising US$500,000 from companies controlled by its CEO and a Director. The loan, which carries a 12% annual interest rate and a two-year term, is secured by the company's assets and subordinated to senior debt. As part of the deal, the company issued 1,086,956 share purchase warrants to each lender, exercisable at US$0.46 per share over 24 months. The proceeds will be used for production costs, supplier payments, payroll, and working capital.
GreenPower Motor Company (Nasdaq: GP) ha concluso la prima tranche della sua offerta di prestito a termine garantito, raccogliendo 500.000 dollari USA da società controllate dal suo CEO e da un Direttore. Il prestito, con un tasso d'interesse annuo del 12% e una durata di due anni, è garantito dagli asset dell'azienda ed è subordinato al debito senior. Nell'ambito dell'accordo, la società ha emesso 1.086.956 warrant di acquisto azioni a ciascun finanziatore, esercitabili a 0,46 dollari USA per azione entro 24 mesi. I fondi raccolti saranno utilizzati per i costi di produzione, pagamenti ai fornitori, stipendi e capitale circolante.
GreenPower Motor Company (Nasdaq: GP) ha cerrado la primera tranche de su oferta de préstamo a plazo garantizado, recaudando 500.000 dólares estadounidenses de empresas controladas por su CEO y un Director. El préstamo, que tiene una tasa de interés anual del 12% y un plazo de dos años, está garantizado por los activos de la compañía y subordinado a la deuda senior. Como parte del acuerdo, la empresa emitió 1.086.956 warrants para compra de acciones a cada prestamista, ejercitables a 0,46 dólares por acción durante 24 meses. Los ingresos se utilizarán para costos de producción, pagos a proveedores, nómina y capital de trabajo.
GreenPower Motor Company (나스닥: GP)는 CEO와 이사가 통제하는 회사들로부터 50만 달러를 조달하며 담보부 기간부 대출 제1차 분할을 완료했습니다. 이 대출은 연 12% 이자율과 2년 만기를 가지며 회사 자산을 담보로 하며 선순위 부채에 종속됩니다. 계약의 일환으로 회사는 각 대출자에게 1,086,956주 주식 매수 워런트를 발행했으며, 이는 주당 0.46달러에 24개월 동안 행사할 수 있습니다. 조달된 자금은 생산 비용, 공급업체 대금, 급여 및 운전자본에 사용될 예정입니다.
GreenPower Motor Company (Nasdaq : GP) a clôturé la première tranche de son émission d'emprunt à terme garanti, levant 500 000 dollars US auprès d'entreprises contrôlées par son PDG et un administrateur. Le prêt, portant un taux d'intérêt annuel de 12 % et d'une durée de deux ans, est garanti par les actifs de la société et subordonné à la dette senior. Dans le cadre de l'accord, la société a émis 1 086 956 bons de souscription d'actions à chaque prêteur, exerçables à 0,46 dollar US par action sur une période de 24 mois. Les fonds seront utilisés pour les coûts de production, les paiements aux fournisseurs, les salaires et le fonds de roulement.
GreenPower Motor Company (Nasdaq: GP) hat die erste Tranche ihres besicherten Terminkreditangebots abgeschlossen und dabei 500.000 US-Dollar von Unternehmen erhalten, die vom CEO und einem Direktor kontrolliert werden. Der Kredit, der einen jährlichen Zinssatz von 12 % und eine Laufzeit von zwei Jahren hat, ist durch die Vermögenswerte des Unternehmens besichert und nachrangig gegenüber vorrangigen Schulden. Im Rahmen der Vereinbarung hat das Unternehmen jedem Kreditgeber 1.086.956 Aktienkaufoptionen ausgegeben, die über 24 Monate zu 0,46 US-Dollar pro Aktie ausgeübt werden können. Die Mittel werden für Produktionskosten, Zahlungen an Lieferanten, Gehälter und Betriebskapital verwendet.
- Secured immediate funding of $500,000 for working capital needs
- Management's confidence demonstrated through insider participation in the loan
- Two-year term provides medium-term financial flexibility
- High interest rate of 12% indicates expensive financing terms
- Potential dilution from warrant issuance at $0.46 per share
- Related party transaction suggests possible difficulties in securing traditional financing
Insights
GreenPower secured $500K emergency financing from insiders at high cost, indicating significant liquidity concerns.
GreenPower has closed the first tranche of a secured term loan for
The 12% interest rate is substantially above market rates for established companies, suggesting lenders perceive significant risk. Even more telling is that management had to turn to insider financing rather than traditional lending sources, typically a sign of limited options.
The loan terms include issuing over 1 million warrants to each lender at
Most concerning is the stated use of proceeds - production costs, supplier payments, and payroll. These are fundamental operational expenses that healthy companies typically cover through operating cash flow, not emergency debt. This strongly indicates GreenPower is experiencing significant working capital constraints.
The structure as a secured loan with a general security agreement means these insiders now have claims against company assets, though subordinated to senior debt. This significantly changes the risk profile for existing investors and creditors.
While the company avoids explicitly stating a cash crisis, the nature, terms, source, and intended use of this financing collectively paint a picture of a company facing substantial liquidity challenges.
In connection with the Loan, the Company entered into respective loan agreements with companies controlled by the CEO and a Director of the Company (the "Initial Lenders"). Management anticipates that the Company will allocate the net proceeds from the Initial Loan towards production costs, supplier payments, payroll and working capital.
The Initial Loan is secured with a general security agreement on the assets of the Company subordinated to all senior debt with financial and other institutions and will bear interest of
As an inducement for the Loan, the Company issued 1,086,956 non-transferable share purchase warrants (each, a "Loan Bonus Warrant") to each Initial Lender. Each Loan Bonus Warrant entitles the holder to purchase one common share of the Company (each, a "Share") at an exercise price of
The Initial Lenders are each considered to be a "related party" within the meaning of Multilateral Instrument 61-101 Protection of Minority Security Holders in Special Transactions ("MI 61-101") and the Initial Loan and issuance of Loan Bonus Warrants is considered to be a "related party transaction" within the meaning of MI 61-101 but each is exempt from the formal valuation requirement and minority approval requirements of MI 61-101 by virtue of the exemptions contained in section 5.5(a) and 5.7(a) as the fair market value of the Initial Loan and Loan Bonus Warrants is not more than
All securities issued in connection with the Initial Loan will be subject to a statutory hold period of four months plus a day from the closing of the Initial Loan in accordance with applicable securities legislation.
For further information contact:
Fraser Atkinson, CEO
(604) 220-8048
Brendan Riley, President
(510) 910-3377
Michael Sieffert, CFO
(604) 563-4144
About GreenPower Motor Company Inc.
GreenPower designs, builds and distributes a full suite of high-floor and low-floor all-electric medium and heavy-duty vehicles, including transit buses, school buses, shuttles, cargo van and a cab and chassis. GreenPower employs a clean-sheet design to manufacture all-electric vehicles that are purpose built to be battery powered with zero emissions while integrating global suppliers for key components. This OEM platform allows GreenPower to meet the specifications of various operators while providing standard parts for ease of maintenance and accessibility for warranty requirements. GreenPower was founded in
Forward-Looking Statements
This news release includes certain "forward-looking statements" under applicable Canadian securities legislation that are not historical facts. Forward-looking statements are not based on historical facts, but rather on current expectations and projections about future events, and are therefore subject to risks and uncertainties which could cause actual results to differ materially from the future results expressed or implied by the forward-looking statements. These statements generally can be identified by the use of forward-looking words such as "upon", "may", "should", "will", "could", "intend", "estimate", "plan", "anticipate", "expect", "believe" or "continue", or the negative thereof or similar variations. Forward-looking statements in this news release include, but are not limited to, statements with respect to the expectations of management regarding the use of proceeds of the Loan. Although the Company believes that and the expectations reflected in the forward-looking information are reasonable, there can be no assurance that such expectations will prove to be correct. Such forward-looking statements are subject to risks and uncertainties that may cause actual results, performance or developments to differ materially from those contained in the statements including that the proceeds of the Loan may not be used as stated in this news release, and those additional risks set out in the Company's public documents filed on SEDAR+ at www.sedarplus.ca and with the United States Securities and Exchange Commission filed on EDGAR at www.sec.gov. Although the Company believes that the assumptions and factors used in preparing the forward-looking statements are reasonable, undue reliance should not be placed on these statements, which only apply as of the date of this news release, and no assurance can be given that such events will occur in the disclosed time frames or at all. Except where required by law, the Company disclaims any intention or obligation to update or revise any forward-looking statement, whether as a result of new information, future events, or otherwise.
Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release. ©2025 GreenPower Motor Company Inc. All rights reserved.
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SOURCE GreenPower Motor Company
FAQ
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