LION ELECTRIC OBTAINS CREDITOR PROTECTION UNDER CCAA
Lion Electric (NYSE: LEV, TSX: LEV), a manufacturer of electric medium and heavy-duty urban vehicles, has obtained creditor protection under the Companies' Creditors Arrangement Act (CCAA). The Superior Court of Quebec issued an initial order appointing Deloitte Restructuring as monitor. The company will seek recognition of CCAA proceedings in the US under Chapter 15 of the Bankruptcy Code.
The court approved a sale and investment solicitation process (SISP) and debtor-in-possession financing. Management will continue operations under monitor oversight, maintaining customer support for school buses and trucks. Trading of LEV shares has been suspended on both NYSE and TSX, with both exchanges initiating delisting proceedings.
Lion Electric (NYSE: LEV, TSX: LEV), un produttore di veicoli elettrici urbani di media e alta capacità, ha ottenuto la protezione dei creditori ai sensi della Legge sulle sistemazioni dei creditori delle società (CCAA). La Corte Superiore del Quebec ha emesso un ordine iniziale che nomina Deloitte Restructuring come supervisore. L'azienda cercherà di ottenere il riconoscimento delle procedure CCAA negli Stati Uniti ai sensi del Capitolo 15 del Codice della Bancarotta.
Il tribunale ha approvato un processo di vendita e sollecitazione di investimenti (SISP) e finanziamenti per debitori in possesso. La direzione continuerà le operazioni sotto la supervisione del monitor, mantenendo il supporto ai clienti per autobus scolastici e camion. La negoziazione delle azioni LEV è stata sospesa sia sulla NYSE che sulla TSX, con entrambi gli scambi che hanno avviato le procedure di delisting.
Lion Electric (NYSE: LEV, TSX: LEV), un fabricante de vehículos eléctricos urbanos de media y gran capacidad, ha obtenido protección para acreedores bajo la Ley de Arreglos de Acreedores de Empresas (CCAA). El Tribunal Superior de Quebec emitió una orden inicial nombrando a Deloitte Restructuring como monitor. La empresa buscará el reconocimiento de los procedimientos de CCAA en Estados Unidos bajo el Capítulo 15 del Código de Bancarrota.
El tribunal aprobó un proceso de solicitud de venta e inversión (SISP) y financiamiento para deudores en posesión. La dirección continuará las operaciones bajo la supervisión del monitor, manteniendo el apoyo al cliente para autobuses escolares y camiones. La negociación de acciones de LEV ha sido suspendida tanto en la NYSE como en la TSX, siendo ambas bolsas las que han iniciado el proceso de desliste.
라이온 일렉트릭 (NYSE: LEV, TSX: LEV)는 중형 및 대형 전기 도시 차량 제조업체로서 회사채권자 배열법(CCAA)에 따라 채권자 보호를 받게 되었습니다. 퀘벡 고등 법원은 Deloitte Restructuring를 모니터로 임명하는 초기 명령을 발부했습니다. 회사는 파산법 제15장에 따라 미국에서 CCAA 절차의 인정을 요청할 것입니다.
법원은 매각 및 투자 요청 프로세스(SISP)와 여유 자금을 지원하는 대출 계약을 승인했습니다. 경영진은 모니터의 감독 하에 운영을 지속하며, 학교 버스 및 트럭에 대한 고객 지원을 유지할 것입니다. LEV 주식의 거래는 NYSE와 TSX에서 모두 중단되었으며, 두 거래소 모두 상장 폐지 절차를 시작했습니다.
Lion Electric (NYSE: LEV, TSX: LEV), un fabricant de véhicules urbains électriques de taille moyenne et lourde, a obtenu une protection des créanciers en vertu de la Loi sur les arrangements de créanciers des entreprises (LACE). La Cour supérieure du Québec a rendu une ordonnance initiale désignant Deloitte Restructuring comme surveillant. L'entreprise cherchera à obtenir la reconnaissance des procédures LACE aux États-Unis en vertu du chapitre 15 du Code de la faillite.
Le tribunal a approuvé un processus de vente et de sollicitation d'investissements (SISP) ainsi qu'un financement pour débiteur en possession. La direction continuera à exploiter ses activités sous la supervision du surveillant, tout en maintenant le soutien à la clientèle pour les autobus scolaires et les camions. La négociation des actions LEV a été suspendue à la fois sur la NYSE et la TSX, les deux bourses ayant engagé des procédures de radiation.
Lion Electric (NYSE: LEV, TSX: LEV), ein Hersteller von elektrischen städtischen Fahrzeugen der mittleren und schweren Klasse, hat gemäß dem Companies' Creditors Arrangement Act (CCAA) Gläubigerschutz beantragt. Das Obergericht von Quebec erließ einen ersten Beschluss, der Deloitte Restructuring als Monitor ernannte. Das Unternehmen wird die Anerkennung der CCAA-Verfahren in den USA gemäß Kapitel 15 des Konkursrechts anstreben.
Das Gericht genehmigte einen Verkaufs- und Investitionsanfrageprozess (SISP) sowie eine Finanzierung für Schuldner in Eigenbesitz. Die Geschäftsführung wird die Betriebe unter der Aufsicht des Monitors weiterführen und die Kundenbetreuung für Schulbusse und Lastwagen aufrechterhalten. Der Handel mit LEV-Aktien wurde sowohl an der NYSE als auch an der TSX ausgesetzt, wobei beide Börsen das Verfahren zur Delistung eingeleitet haben.
- Company continues operations and customer support during restructuring
- Secured debtor-in-possession financing for ongoing operations
- Court-approved sale process (SISP) to explore strategic alternatives
- Filed for creditor protection under CCAA
- Trading suspended on NYSE and TSX
- Facing potential delisting from both exchanges
- Requires court approval for continued financing
- Business undergoing forced restructuring
Insights
The CCAA filing represents a critical financial restructuring for Lion Electric. The Canadian equivalent of Chapter 11 bankruptcy protection provides the company temporary relief from creditor claims while attempting to reorganize. The approval of DIP financing is particularly important as it allows continued operations during restructuring. The implementation of a Sale and Investment Solicitation Process (SISP) indicates the company is actively seeking strategic alternatives, including potential sale of assets or the entire business.
The suspension of trading and delisting review by both TSX and NYSE significantly impacts shareholders, as their equity positions could be severely diluted or potentially wiped out through the restructuring process. The cross-border nature of the proceedings, with planned Chapter 15 recognition in the US, adds complexity to the restructuring process.
This bankruptcy protection filing reflects broader challenges in the EV commercial vehicle sector. Lion Electric's situation mirrors industry-wide pressures including high production costs, slower-than-expected market adoption and intense competition. The company's focus on maintaining customer support for existing vehicles is important but may not be enough to ensure long-term survival.
The timing is particularly challenging as government initiatives are pushing for increased EV adoption in commercial fleets. This restructuring could create opportunities for competitors to capture market share in the growing electric school bus and truck segments. The outcome of the SISP will likely attract interest from both strategic buyers and financial investors looking to acquire EV manufacturing capabilities at potentially distressed valuations.
With a market cap of just
For retail investors, this development essentially represents a near-total loss scenario. The restructuring process typically leaves common shareholders with minimal to no recovery, as creditors' claims take precedence. The company's ability to emerge from bankruptcy will depend on the success of the SISP and the willingness of new investors to inject capital into the business.
The Court also issued an order approving a sale and investment solicitation process in respect of the Company's business or assets (the "SISP") in order to provide interested parties with the opportunity to submit proposals, with a view to enable the Company and its senior lenders to determine the highest and best available transaction for the Company and its stakeholders. In addition, the Initial Order provides for, among other things, a stay of proceedings in favor of the Company and its subsidiaries, including a stay of creditor claims and exercise of contractual rights, and the approval of debtor-in-possession financing (the "DIP Financing") provided by the lenders under the Company's syndicated senior revolving credit agreement in order to fund the SISP and the Company's operations during the restructuring process. The continued availability of the DIP Financing is dependent upon certain conditions being satisfied, including Court approval.
While under CCAA protection, management of the Company will remain responsible for the day-to-day operations of the Company under the oversight of the Monitor. Lion intends to continue assisting its customers with the maintenance and servicing of school buses and trucks.
A copy of the initial order granted by the Court will be available, along with additional information respecting the CCAA proceedings, on the Monitor's website. Readers are urged to consult the full text of all of these documents for further, more detailed, information. Further news releases will be provided during the CCAA proceedings as required by law or otherwise as may be determined necessary by the Company or the Court. Documents relating to the restructuring process such as the initial order, the Monitor's reports to the Court as well as other Court orders and documents shall also be published and made available on the Monitor's website at https://www.insolvencies.deloitte.ca/en-ca/pages/Lion-Electric-Company.aspx.
Trading in the common shares and other listed securities of the Company on the Toronto Stock Exchange ("TSX") and the New York Stock Exchange (the "NYSE") has been suspended. The TSX has put the Company under delisting review under its expedited review process and the NYSE has commenced delisting proceedings against the Company. It is anticipated that trading in the Company's listed securities will continue to be suspended until completion of the review and proceedings undertaken by the TSX and the NYSE.
ABOUT LION ELECTRIC
Lion Electric is an innovative manufacturer of zero-emission vehicles, including all electric school buses. Lion is a North American leader in electric transportation and designs, builds and assembles many of its vehicles' components, including chassis, battery packs, truck cabins and bus bodies.
Always actively seeking new and reliable technologies, Lion vehicles have unique features that are specifically adapted to its users and their everyday needs. Lion believes that transitioning to all-electric vehicles will lead to major improvements in our society, environment and overall quality of life. Lion shares are traded on the New York Stock Exchange and the Toronto Stock Exchange under the symbol LEV.
CAUTION REGARDING FORWARD-LOOKING STATEMENTS
This press release contains "forward-looking information" and "forward-looking statements" within the meaning of applicable securities laws and within the meaning of the United States Private Securities Litigation Reform Act of 1995 (collectively, "forward-looking statements"), including statements regarding the CCAA proceedings and SISP, trading in the Company's common shares and other listed securities, and statements about Lion's beliefs and expectations and other statements that are not statements of historical facts. Forward-looking statements may be identified by the use of words such as "believe," "may," "will," "continue," "anticipate," "intend," "expect," "should," "would," "could," "plan," "project," "potential," "seem," "seek," "future," "target" or other similar expressions and any other statements that predict or indicate future events or trends or that are not statements of historical matters, although not all forward-looking statements may contain such identifying words. The forward-looking statements contained in this press release are based on a number of estimates and assumptions that Lion believes are reasonable when made. Such estimates and assumptions are made by Lion in light of the experience of management and their perception of historical trends, current conditions and expected future developments, as well as other factors believed to be appropriate and reasonable in the circumstances. However, there can be no assurance that such estimates and assumptions will prove to be correct. By their nature, forward-looking statements involve risks and uncertainties because they relate to events and depend on circumstances that may or may not occur in the future. For additional information on estimates, assumptions, risks and uncertainties underlying certain of the forward-looking statements made in this press release, please consult section 23.0 entitled "Risk Factors" of the Company's annual management's discussion and analysis of financial condition and results of operations (MD&A) for the fiscal year 2023 and in other documents filed with the applicable Canadian regulatory securities authorities and the Securities and Exchange Commission, including the Company's interim MD&As. Many of these risks are beyond Lion's management's ability to control or predict. All forward-looking statements attributable to Lion or persons acting on its behalf are expressly qualified in their entirety by the cautionary statements contained and risk factors identified in the Company's annual MD&A for the fiscal year 2023 and in other documents filed with the applicable Canadian regulatory securities authorities and the Securities and Exchange Commission. Because of these risks, uncertainties and assumptions, readers should not place undue reliance on these forward-looking statements. Furthermore, forward-looking statements speak only as of the date they are made. Except as required under applicable securities laws, Lion undertakes no obligation, and expressly disclaims any duty, to update, revise or review any forward-looking information, whether as a result of new information, future events or otherwise.
See section 2.0 of the Company's interim management's discussion and analysis for the three and nine months ended September 30, 2024 (the "Interim MD&A"), entitled "Basis of Presentation," section 15.0 of the Company's Interim MD&A entitled "Liquidity and Capital Resources," and note 2 of the Company's unaudited condensed interim consolidated financial statements as at September 30, 2024 and for the three and nine months ended September 30, 2024 and 2023 which indicate the existence of material uncertainty that may cast significant doubt on the Company's ability to continue as a going concern.
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SOURCE The Lion Electric Co.
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