Grande West Transportation Group Inc.
TSX VENTURE : BUS

Grande West Transportation Group Inc.

February 13, 2015 10:54 ET

Grande West Amends Funding Terms to Include Convertible Debentures

VANCOUVER, BRITISH COLUMBIA--(Marketwired - Feb. 13, 2015) -

NOT FOR DISSEMINATION IN THE UNITED STATES OR FOR DISTRIBUTION TO U.S. NEWSWIRE SERVICES

Grande West Transportation Group Inc. (TSX VENTURE:BUS) ("Grande West" or the "Company") is pleased to announce that concurrent to the private placement equity offering announced by news release on January 26, 2015 (the "Unit Offering"), a convertible debenture offering alternative is being offered. The reason for the change is a long standing major institutional shareholder has committed $500,000 to the funding and has requested that investment be in the form of a convertible debenture. A number of other large potential investors (each being over $200,000) have also requested a convertible debenture alternative. The total funding remains at $3,000,000 or such other amount agreed to between the Company and the Agent through a combination of equity and convertible debentures.

Therefore, Grande West has entered into an engagement letter with Euro Pacific Canada, Inc. (the "Agent"), as agent, to sell, on a "commercially reasonable efforts" private placement basis (the "Note Offering", and together with the Unit Offering, the "Offering"), of unsecured convertible notes in denominations of $1,000 each (the "Notes"). Each Note is convertible into common shares in the capital of the Company ("Common Shares") at the option of the holder at the conversion price of $0.33 per Common Share. The Notes will mature 5 years from the date of issue and pay interest at a fixed rate of 8% per annum from the closing date of the Offering, payable quarterly in arrears from the date of issue to the Maturity Date.

As previously announced, under the Unit Offering, the Agent has been engaged to sell, on a "commercially reasonable efforts" private placement basis, up to 12,000,000 units (the "Units") at a price of $0.25 per Unit, for aggregate gross proceeds to Grande West of up to $3,000,000. Each Unit shall consist of one Common Share and a half of one non-transferable share purchase warrant (each whole warrant, a "Warrant"). Each Warrant shall then entitle the holder thereof to acquire one additional Common Share for a period of 36 months from the closing date of the Offering at an exercise price of $0.40.

Insiders and founding shareholders of the Company have committed to participate in the funding for a minimum of $1,000,000.

The net proceeds from the Private Placement will be used to fund the operations of the Company through to achieving positive cash flow. The sales order pipeline projections for Vicinity buses have materially improved for 2015 and subsequent years.

Completion of the Offering is subject to a number of conditions, including the completion of due diligence by the Agent, the negotiation and execution of definitive documentation and receipt of the approval of the TSX.V to list the Common Shares underlying the Notes, the Units and the Warrants on the TSX.V. All securities issued pursuant to the Offering will be subject to a four month and one day hold period in accordance with applicable securities laws.

The Offering will be exempt from prospectus and registration requirements of applicable securities laws. The securities have not been and will not be registered under the United States Securities Act of 1933, as amended (the " U.S. Securities Act"), or any state securities laws, and accordingly, may not be offered or sold within the United States or to "U.S. Persons", as such term is defined in Regulation S promulgated under the U.S Securities Act ("U.S. Persons"), except in compliance with the registration requirements of the U.S. Securities Act and applicable state securities requirements or pursuant to exemptions therefrom. This news release shall not constitute an offer to sell or a solicitation of an offer to buy any of the securities in the United States.

About Grande West Transportation Group

Grande West was formed in 2008 to design and develop a 27.5 foot bus, known as the "Vicinity." With little competition in the "mid-size" bus range, Grande West has set itself apart from others with the Vicinity bus - a heavy duty mid-size, true community transit bus.

The Vicinity is designed with affordability, accessibility and global responsibility in mind. It costs 40% less than a regular 40 foot transit bus, burns less fuel, emits less harmful emissions and has lower maintenance costs. The Vicinity achieves a life span twice as long as the cut-away buses which are based on a truck chassis and are currently used by many transit operators. The Vicinity also has materially lower maintenance costs than a cut-away bus.

In a large and unsaturated market segment, Grande West is poised to capture sales growth from both the replacement of cut-away buses and the right sizing of larger buses for better utilization of transit fleets across Canada and the United States.

Grande West has delivered to date a total of 31 Vicinity buses: 15 buses to BC Transit, 3 buses to Kings Transit in Nova Scotia and 13 buses to Transdev in Quebec. There are 5 Vicinity buses currently in production for customer deliveries in May which would bring the total number of Vicinity buses in operation to 36. The future sales funnel is constantly growing. As the Vicinity is introduced to transit agencies across Canada, a strong interest in the Vicinity is being generating.

For marketing and customer testing, three Vicinity buses are now being demonstrated including our new 30 foot model with two doors for the Ontario market and airport shuttle bus applications.

Neither the TSX-V nor its Regulation Service Provider (as that term is defined in the policies of the TSX-V) accepts responsibility for the adequacy or accuracy of this release.

Cautionary Note Regarding Forward-Looking Statements

This press release includes certain "forward-looking information" and "forward-looking statements" (collectively "forward-looking statements") within the meaning of applicable Canadian securities legislation. All statements, other than statements of historical fact, included herein, including without limitation, statements regarding the completion of the Offering and the use of proceeds from the Offering, are forward-looking statements. Forward-looking statements are frequently, but not always, identified by words such as "expects", "anticipates", "believes", "intends", "estimates", "potential", "possible", and similar expressions, or statements that events, conditions, or results "will", "may", "could", or "should" occur or be achieved. Forward-looking statements involve various risks and uncertainties. There can be no assurance that such statements will prove to be accurate, and actual results and future events could differ materially from those anticipated in such statements.

Important factors that could cause actual results to differ materially from Grande West's expectations include uncertainties relating to the ability to confirm the commitments received by prospective investors, negotiate the Offering on acceptable terms; timing of closing; the ability to satisfy conditions of the Offering receipt of approval from the TSXV; completion of the Offering; and other risk and uncertainties disclosed in Grande West's reports and documents filed with applicable securities regulatory authorities from time to time. Grande West's forward-looking statements reflect the beliefs, opinions and projections on the date the statements are made. Grande West assumes no obligation to update the forward-looking statements or beliefs, opinions, projections, or other factors, should they change, except as required by law.

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