LeddarTech announces up to $9M financing

LeddarTech Holdings entered into definitive agreements with certain of its principal shareholders, FS Investors and Investissement Quebec, and its senior lender, Federation des caisses Desjardins du Quebec, pursuant to which the Bridge Lenders make available to the Company bridge loans in an aggregate amount of up to US$9.0 million. Under the Bridge Financing, FS and IQ have the right, but not the obligation, to convert their respective Bridge Loan into common shares in the capital of the Company at an initial conversion price of US$5.00 per Common Share, subject to adjustment, representing a premium of 852% above the closing price of the Common Shares on August 16, 2024. In connection with the Bridge Financing, FS has agreed to convert US$1.5 million of its existing convertible notes into Common Shares at an above-market conversion price of US$2.00 per share, reducing the convertible note balance by US$1.5 million. The Bridge Financing is comprised of two tranches, with the first tranche of US$6.0 million funding immediately and the second tranche of US$3.0 million to be funded on or about October 15, 2024. The second tranche of the Bridge Financing is conditioned on the absence of a default under the Bridge Loans and the receipt by the Company of a commitment from a strategic investor to invest a minimum amount of US$5.0 million in a subsequent equity capital raise. The Bridge Loans from FS and IQ will be issued at a 25% original issue discount. Amounts outstanding under the Bridge Loans bear interest at the US base rate, plus 4.00%. Interest under the Bridge Loans is to be capitalized monthly and added to the outstanding principal amount of the Bridge Loans. The Bridge Loans have a maturity date of November 15, 2024 and will be due and payable earlier upon the occurrence of certain other events, such as a change in control. In connection with the Bridge Financing, the Company and Desjardins have also entered into a Thirteenth Amending Agreement to the Amended and Restated Financing Offer dated as of April 5, 2023 to harmonize the Desjardins Credit Facility with the terms and conditions set forth in the Bridge Loans, and to include an amendment fee in consideration of Desjardins’ agreement to authorize the indebtedness under the Bridge Financing and that the security under the Bridge Financing will rank pari passu to the security of Desjardins under the Desjardins Credit Facility.