GreenPower Announces Closing of U.S. Initial Public Offering

Rhea-AI Summary

GreenPower Motor Company (NASDAQ: GP) has successfully closed its upsized U.S. initial public offering, selling 1,860,000 common shares at US$20.00 each, raising gross proceeds of approximately US$37.2 million. The shares began trading on August 28, 2020. The company aims to utilize the net proceeds for the production of all-electric vehicles, product development, and geographic expansion. In connection with the offering, a consolidation of shares occurred, changing the ratio to one post-consolidation share for every seven pre-consolidation shares. A related party private placement also took place, raising an additional US$500,000.

Positive

• Gross proceeds from the public offering totaled US$37.2 million.
• Net proceeds will support the production of all-electric vehicles and geographic expansion.
• Shares began trading on Nasdaq, increasing visibility and market access.

Negative

• The share consolidation may dilute existing shareholder value.
• The private placement involved a related party transaction, raising potential conflict of interest concerns.

VANCOUVER, BC, Sept. 1, 2020 /PRNewswire/ -- GreenPower Motor Company Inc. (NASDAQ: GP) / (TSXV: GPV) (the "Company" or "GreenPower") today announced the closing of its previously announced upsized U.S. initial public offering (the "Offering") of 1,860,000 post-consolidation common shares of the Company (each, a "Share"), at a price to the public of US$20.00 per Share. In addition, the Company has granted the underwriters a 30-day option to purchase up to an additional 279,000 Shares at US$20.00 per Share, less the underwriting discounts and commissions. The gross proceeds from the Offering, before deducting underwriting discounts and commissions of US$1.40 per Share and estimated offering expenses payable by the Company, were US$37.2 million. The Shares began trading on the Nasdaq Capital Market on August 28, 2020, under the symbol "GP."

The Company intends to use the net proceeds from the Offering for the production of all-electric vehicles, including EV Stars, EV Star plus, EV Star cab and chassis, B.E.A.S.T. school buses, EV250 thirty foot low floor transit style buses, product development and geographic expansion with the remainder, if any, for working capital.

In connection with the Offering, the Company completed a consolidation of its common shares on the basis of seven (7) pre-consolidation common shares for one (1) post-consolidation common share which became effective at the opening of the market on August 28, 2020. The common shares of the Company, which were previously traded on the OTCQB, operated by the OTC Market Group Inc. (the "OTCQB"), are no longer quoted for trading on the OTCQB. The common shares of the Company continue to be listed for trading on the TSX Venture Exchange ("TSXV").

B. Riley FBR served as the lead book-running manager in the Offering. Roth Capital Partners  also served as a book-running manager in the Offering.  ThinkEquity, a division of Fordham Financial Management, Inc., Maxim Group LLC and PI Financial (US) Corp. served as co-managers in the Offering.

The underwriters did not, directly or indirectly, solicit offers to purchase or sell the Company's Shares in Canada.

A registration statement on Form F-1 relating to the Offering has been filed with the Securities and Exchange Commission and became effective on August 27, 2020. The Offering was made only by means of a prospectus. Copies of the final prospectus may be obtained from: B. Riley FBR, Attention: Prospectus Department, 1300 17th St. North, Ste. 1300, Arlington, VA 22209, or by email at prospectuses@brileyfbr.com, or by telephone at (703) 312-9580 or by accessing the SEC's website at www.sec.gov.

Concurrently with the closing of the Offering, the Company closed a separate non-brokered private placement pursuant to Regulation S under the Securities Act of 1933 (the "Private Placement"), in which the Company sold 25,000 post-consolidation common shares (each, a "Private Placement Share") for total gross proceeds of US$500,000 to Koko Financial Services Ltd. (the "Private Placement Subscriber"), a company owned by GreenPower's executive chairman and chief executive officer, Fraser Atkinson, at a price of US$20.00 per Private Placement Share, being the price to the public per Share of the Offering, and without payment by the Company of any underwriting discount, bonus, finder's fee or commission.

The Private Placement Subscriber is a "related party" of the Company within the meaning of Multilateral Instrument 61-101 – Protection of Minority Security Holders in Special Transactions ("MI 61-101") and Policy 5.9 of the TSXV. Therefore, the issuance of the Private Placement Shares to the Private Placement Subscriber is a "related party transaction" within the meaning of MI 61-101. As the material change report relating to the closing of the Private Placement is being filed on SEDAR less than 21 days before the closing of the Private Placement, there is a requirement under MI 61–101 to explain why the shorter period is reasonable or necessary in the circumstances. In the view of the Company, such shorter period is reasonable and necessary in the circumstances because the Company wished to complete the Offering and the Private Placement in a timely manner. Other than the Private Placement Subscriber, the Company is aware of no other participation by Insiders (as defined in the Policies of the TSXV) in the Offering and the Private Placement.

The TSXV has conditionally accepted the Private Placement, which is subject to the final acceptance of the TSXV. All of the Private Placement Shares are subject to a restricted period of four months and one day from the date of issuance under applicable securities laws. In addition, pursuant to a lock-up agreement entered into in connection with the Offering, the Private Placement Subscriber is subject to a contractual hold period of 180 days from the date of the final prospectus in the Offering in respect of all securities of the Company owned by the Private Placement Subscriber.

This press release does not constitute an offer to sell or a solicitation of an offer to buy these securities, nor shall there be any sale of these securities in any state in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such state or jurisdiction.

About GreenPower Motor Company Inc.

GreenPower designs, builds and distributes a full suite of high-floor and low-floor vehicles, including transit buses, school buses, shuttles, and a double decker.  GreenPower employs a clean-sheet design to manufacture all-electric buses that are purpose built to be battery powered with zero emissions. 

Forward-Looking Statements

This press release contains forward-looking statements. 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 "may", "should", "will", "could", "intend", "estimate", "plan", "anticipate", "expect", "believe" or "continue", or the negative thereof or similar variations. The Forward-looking statements in this press release include statements relating to the Company's expectations regarding the intended use of the net proceeds from the Offering and the final acceptance of the TSXV in respect of the Private Placement. These statements involve risks, estimates, assumptions and uncertainties that could cause actual results to differ materially from those expressed in these statements, including, among others, risks and uncertainties associated with market conditions and the satisfaction of all applicable regulatory requirements, as well as risks and uncertainties associated with the Company's business and finances in general. Because the risks, estimates, assumptions and uncertainties referred to above could cause actual results or outcomes to differ materially from those expressed in any forward-looking statements, readers are cautioned not to place undue reliance on any forward-looking statements, which speak only as of the date on which they are made. The Company undertakes no obligation to update or revise any forward-looking statements for any reason, except as required by law, including the securities laws of the United States and Canada.

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 press release.

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SOURCE GreenPower Motor Company

FAQ

What are the details of GreenPower's initial public offering?

GreenPower closed its U.S. IPO on August 28, 2020, offering 1,860,000 shares at US$20.00 each, with gross proceeds of US$37.2 million.

How will GreenPower use the funds raised from the IPO?

The funds will be used for producing all-electric vehicles, expanding product development, and geographic expansion.

What is the effect of the share consolidation on existing shareholders?

The consolidation was on a 7-to-1 basis, which may dilute existing shareholder value.

Was there any related party transaction during the offering?

Yes, a private placement raised US$500,000 from a company owned by GreenPower's CEO, which is considered a related party transaction.