Tuesday September 26, 2017 0 comments
LONGMONT -- UQM Technologies, Inc. (NYSE American: UQM) today announced it closed the first-stage investment under its stock purchase agreement with China National Heavy Duty Truck Group Co., Ltd. (“CNHTC”) through its wholly owned subsidiary, Sinotruk (BVI) Limited.
In this first-stage investment, UQM said CNHTC acquired 5,347,300 newly issued common shares of UQM, resulting in a 9.9% ownership interest in UQM.
The purchase price is $0.95 per share, which represents a 15% premium over the 30-day closing price average for the period ending on the last trading date before the signing of the agreement on Aug. 25.
UQM said it s receiving $5.1 million of cash proceeds from this first closing.
Closing of the second-stage investment will require approval by UQM’s shareholders and clearance by the Committee on Foreign Investment in the United States, the company said. The parties expect the second-stage investment to close as soon as those approvals are received.
As part of the agreement, upon the closing of the first-stage investment, Ma Chunji, chairman of CNHTC, has been appointed to UQM’s board as a non-voting observer member.
Upon closing of the second-stage investment, UQM will increase the size of its board to eight members, the board observer shall have all the rights of a full board member and CNHTC will have the right to nominate two additional board members, with one CNHTC representative expected to be elected as board chairman.
After the closing of the second-stage investment, UQM and CNHTC intend to form a joint venture for the manufacture and sale of electric propulsion systems in China. The parties said they expect Sinotruk to be a significant purchaser of electric propulsion systems from the joint venture, and other customers will also be identified.
The parties said they are continuing work to complete the definitive agreement that will define the terms of this joint venture in China.
“The closing of the first-stage investment is a significant milestone in our new relationship with CNHTC,” said Joe Mitchell, UQM president and CEO.
“The proceeds from this investment add strength and stability to our balance sheet. We are now actively engaged to obtain approvals from our shareholders and from the Committee on Foreign Investment in the United States (CFIUS), so that we can finalize the second-stage investment from CNHTC.
“This will allow us to execute on our strategy to become a major player in the electric vehicle propulsion market in China.”