LeddarTech secures $9M bridge financing

QUEBEC CITY — LeddarTech Holdings, an automotive software company, enters into definitive agreements with its principal shareholders, FS Investors and Investissement Québec, and Fédération des caisses Desjardins du Québec, for a bridge financing arrangement. The Bridge Lenders will provide up to US$9 million in bridge loans.

The financing is structured in two tranches. The first tranche of US$6 million will be provided immediately, and the second tranche of US$3 million is expected to be funded around October 15, 2024, contingent on specific conditions. FS and IQ can convert their loans into common shares at an initial conversion price of US$5.00 per share, an 852 per cent premium over the closing price on August 16, 2024.

FS will also convert US$1.5 million of its existing convertible notes into common shares at a conversion price of US$2.00 per share. The bridge loans will be issued at a 25% per cent original issue discount, meaning US$8.0 million of loans will be issued for US$6.0 million in gross proceeds. The loans will bear interest at the US base rate (currently 9.0 per cent) plus 4.00 per cent, with interest capitalized monthly. The loan maturity date is November 15, 2024, with the possibility of earlier repayment under certain conditions.

Additionally, an amendment agreement has been made with Desjardins to align the terms of the bridge financing with the existing Desjardins Credit Facility. The transaction is classified as a related-party transaction under Regulation 61-101, and the company is relying on the financial hardship exemption from formal valuation and minority shareholder approval requirements.