LION ELECTRIC ANNOUNCES AMENDMENTS TO CERTAIN SENIOR CREDIT INSTRUMENTS AND THE ENTERING INTO OF NEW FINANCING

Core Viewpoint - The Lion Electric Company has amended its senior credit instruments to enhance liquidity and financial flexibility during a covenant relief period until September 30, 2024, while maintaining certain financial obligations and reporting requirements [1][2][7]. Group 1: Revolving Credit Agreement Amendments - The amendments to the revolving credit agreement suspend financial covenants, including the tangible net worth test and fixed charge coverage ratio, until September 30, 2024 [1]. - The company must maintain a minimum available liquidity of C$15,000,000 during the covenant relief period [1]. - Enhanced reporting obligations and limitations on the use of advances under the revolving credit facility are introduced until the available amount equals or exceeds 50% of total borrowing capacity for 30 consecutive days [1]. - Certain previous requirements, such as the availability block and interest reserve account funding, are no longer applicable [1]. - The pricing grid will see increases, and interest payments under the revolving credit facility will be deferred during the covenant relief period [1]. Group 2: Loan Agreement Amendments - The loan agreement with Finalta Capital Fund and Caisse de dépôt et placement du Quebec has been amended to align the minimum liquidity requirement with that of the revolving credit agreement [2]. - The interest rate on the loan agreement has been increased to 13%, with 50% of the interest payable capitalized during the covenant relief period [2]. - Other material terms of the loan agreement, including the maturity date of November 6, 2024, remain unchanged [2]. Group 3: Financial Position and Opportunities - The company is actively evaluating opportunities to improve liquidity and strengthen its financial position, which may include refinancing initiatives related to its debt instruments [3]. Group 4: Company Overview - Lion Electric is a manufacturer of zero-emission vehicles, focusing on all-electric commercial urban trucks and school buses, and is a leader in North American electric transportation [4][11]. - The company designs and assembles many components of its vehicles, including chassis and battery packs [4]. Group 5: New Financing Agreement - The company has entered into a new ESSOR loan agreement for C$5,000,000, which may be drawn up to C$7,500,000 under certain conditions, with a fixed interest rate of 13% and a 12-month moratorium on principal and interest payments [7][8]. Group 6: Non-Convertible Debentures - Amendments to the non-convertible debentures issued in July 2023 include the capitalization of 50% of the interest payable during the covenant relief period [9].