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Vicinity Motor Corp. (NASDAQ:VEV)(TSXV:VMC), a North American supplier of commercial electric vehicles, announced unsuccessful negotiations with Royal Bank of Canada (RBC) and Export Development Canada (EDC) for credit facility renewals. The company faces potential receivership enforcement, which may lead to layoffs and cessation of operations. RBC’s restrictions have severely constrained Vicinity’s ability to manage finances and operations.
The Workout Plan period concludes on October 11, 2024, without a successful financial restructuring. Vicinity also updated on its management cease trade order (MCTO) related to late filing of interim financial statements. If the company fails to file by October 18, 2024, a broad failure to file cease trade order may be issued, halting all share trading in Canada.
Vicinity Motor Corp. (NASDAQ:VEV)(TSXV:VMC), un fornitore nordamericano di veicoli elettrici commerciali, ha annunciato di aver avuto negoziazioni infruttuose con la Royal Bank of Canada (RBC) e l’Export Development Canada (EDC) per il rinnovo delle linee di credito. L’azienda affronta la potenziale esecuzione in amministrazione controllata, il che potrebbe portare a licenziamenti e cessazione delle operazioni. Le restrizioni della RBC hanno gravemente limitato la capacità di Vicinity di gestire le finanze e le operazioni.
Il periodo del Piano di Ristrutturazione si conclude l’11 ottobre 2024, senza una ristrutturazione finanziaria riuscita. Vicinity ha anche fornito aggiornamenti riguardo al divieto di negoziazione per la direzione (MCTO) relativo al ritardo nella presentazione dei bilanci finanziari intermedi. Se l’azienda non presenterà i documenti entro il 18 ottobre 2024, potrebbe essere emesso un divieto di negoziazione generale, bloccando tutte le operazioni azionarie in Canada.
Vicinity Motor Corp. (NASDAQ:VEV)(TSXV:VMC), un proveedor norteamericano de vehículos eléctricos comerciales, anunció negociaciones infructuosas con Royal Bank of Canada (RBC) y Export Development Canada (EDC) para la renovación de líneas de crédito. La empresa enfrenta la posible ejecución de una administración controlada, lo que podría llevar a despidos y a la cesación de operaciones. Las restricciones de RBC han limitado severamente la capacidad de Vicinity para gestionar sus finanzas y operaciones.
El período del Plan de Reestructuración concluye el 11 de octubre de 2024, sin una reestructuración financiera exitosa. Vicinity también actualizó sobre su orden de cesación de comercio de dirección (MCTO) relacionada con la presentación tardía de los estados financieros intermedios. Si la empresa no presenta a tiempo los documentos antes del 18 de octubre de 2024, se podría emitir una orden de cesación de comercio general, deteniendo todas las negociaciones de acciones en Canadá.
Vicinity Motor Corp. (NASDAQ:VEV)(TSXV:VMC)는 북미 상업 전기차 공급업체로, Royal Bank of Canada (RBC)와 Export Development Canada (EDC)와의 신용 시설 갱신에 대한 협상이 실패했다고 발표했습니다. 회사는 잠재적인 receivership 강제 집행에 직면해 있으며, 이는 해고와 운영 중단으로 이어질 수 있습니다. RBC의 제한은 Vicinity가 재정 및 운영을 관리하는 능력을 심각하게 제한했습니다.
워크아웃 계획 기간은 2024년 10월 11일에 종료되며, 성공적인 재정 재구성이 이루어지지 않을 것입니다. Vicinity는 또한 중간 재무제표 제출 지연과 관련된 관리 중지 거래 명령(MCTO)에 대해 업데이트했습니다. 회사가 2024년 10월 18일까지 파일을 제출하지 않으면, 모든 주식 거래를 중단시키는 광범위한 거래 중지 명령이 발부될 수 있습니다.
Vicinity Motor Corp. (NASDAQ:VEV)(TSXV:VMC), un fournisseur nord-américain de véhicules électriques commerciaux, a annoncé l’échec des négociations avec la Royal Bank of Canada (RBC) et Export Development Canada (EDC) pour le renouvellement de lignes de crédit. L’entreprise fait face à une possible mise sous administration judiciaire, ce qui pourrait entraîner des licenciements et l’arrêt des opérations. Les restrictions imposées par la RBC ont considérablement contraint la capacité de Vicinity à gérer ses finances et ses opérations.
La période du Plan de Restructuration se termine le 11 octobre 2024, sans qu’une restructuration financière réussie ait eu lieu. Vicinity a également mis à jour son ordre de cessation de négociation pour la direction (MCTO) lié au dépôt tardif des états financiers intermédiaires. Si l’entreprise ne parvient pas à déposer d’ici le 18 octobre 2024, un large ordre de cessation de négociation pourrait être émis, mettant un terme à toutes les transactions d’actions au Canada.
Vicinity Motor Corp. (NASDAQ:VEV)(TSXV:VMC), ein nordamerikanischer Lieferant von kommerziellen Elektrofahrzeugen, gab bekannt, dass die Verhandlungen mit der Royal Bank of Canada (RBC) und der Export Development Canada (EDC) über die Erneuerung von Kreditfazilitäten gescheitert sind. Das Unternehmen sieht sich mit einer möglichen Zwangsverwaltung konfrontiert, was zu Entlassungen und einer Einstellung der Geschäftstätigkeit führen könnte. Die Einschränkungen der RBC haben die Fähigkeit von Vicinity, Finanzen und Betrieb zu managen, erheblich eingeschränkt.
Der Zeitraum des Workout-Plans endet am 11. Oktober 2024, ohne dass eine erfolgreiche finanzielle Restrukturierung erfolgt. Vicinity hat auch ein Update zu seiner Verwaltungsstopp-Handelsanordnung (MCTO) gegeben, die sich auf die verspätete Einreichung von Zwischenfinanzberichten bezieht. Wenn das Unternehmen die Berichte bis zum 18. Oktober 2024 nicht einreicht, könnte eine umfassende Handelsstoppordnung erlassen werden, die den Handel mit Aktien in Kanada stoppt.
Negative
- Unsuccessful credit facility renewal negotiations with RBC and EDC
- Potential receivership enforcement, possibly leading to layoffs and cessation of operations
- Severe financial and operational constraints due to RBC’s restrictions
- Failure to achieve financial restructuring during Workout Plan period
- Risk of broad failure to file cease trade order if interim filings are not submitted by October 18, 2024
Insights
This news is highly concerning for Vicinity Motor Corp. and its investors. The company’s failure to renegotiate terms with its creditors, Royal Bank of Canada (RBC) and Export Development Canada (EDC), has led to a critical financial situation. The creditors’ decision not to renew credit facilities and the subsequent restrictions on asset access have severely impacted the company’s operations.
Key points:
- Vicinity Motor Corp. is likely facing imminent receivership enforcement
- The company may be forced to lay off remaining staff and cease operations
- There’s a risk of a broad failure-to-file cease trade order if interim filings aren’t submitted by October 18, 2024
- The company is currently under a Management Cease Trade Order (MCTO)
This situation poses a significant risk to shareholders, as the company’s ability to continue as a going concern is in serious doubt. The potential for receivership and cessation of operations could lead to a total loss for equity investors. The ongoing financial constraints and regulatory issues further compound the company’s problems, making any near-term recovery unlikely.
The legal implications of Vicinity Motor Corp.’s current situation are severe and multifaceted:
- Creditor Enforcement: RBC and EDC’s potential move towards receivership enforcement could lead to a formal insolvency proceeding, likely under the Bankruptcy and Insolvency Act or the Companies’ Creditors Arrangement Act.
- Regulatory Compliance: The company is at risk of violating securities regulations due to the delayed filing of interim financial statements. The current MCTO could escalate to a broader cease trade order, effectively freezing all trading of the company’s shares in Canada.
- Insider Trading: The imposed insider trading blackout is a necessary legal precaution given the material non-public information surrounding the company’s financial status.
- Stakeholder Obligations: The company’s inability to meet vendor and customer obligations could lead to numerous legal claims and potential lawsuits.
These legal challenges significantly increase the company’s risk profile and could result in protracted legal proceedings, further eroding any remaining shareholder value.
VANCOUVER, BC / ACCESSWIRE / October 11, 2024 / Vicinity Motor Corp. (NASDAQ:VEV)(TSXV:VMC) (“Vicinity” or the “Company”), a North American supplier of commercial electric vehicles, today announced that it has not been successful renegotiating terms with Royal Bank of Canada (“RBC”) or Export Development Canada (“EDC” and together with RBC, the “Creditors”).
As disclosed in the Company’s publicly filed interim financial statements for the three months ended March 31, 2024, the credit facilities were set be renewed on a yearly basis, at the discretion of the Creditors, on July 16, 2024. The Company had actively been working with RBC and EDC on securing a renewal, but as previously announced by the Company, on August 9, 2024, the Creditors exercised their discretion not to renew the credit facilities and provided the Company with Notice of Intention to Enforce Security pursuant to subsection 244(1) of the Bankruptcy and Insolvency Act (Canada).
Additionally, in early August, RBC restricted the Company’s access to certain assets without advance notice which gravely impeded the Company’s ability to operate at that time. Accordingly, the Company has been severely constrained in its ability to manage its finances, including vendor and customer obligations.
On August 21, 2024, the Company announced that it had reached an agreement with RBC to enter into a Workout Plan (“Plan”) period whereby the Company would continue to operate on a limited basis while protecting and monetizing Company assets and endeavoring toward a financial restructuring. During the Plan period, the Creditor-imposed constraints were enhanced resulting in further financial and operational stress. The Company has continued to negotiate with the Creditors in good-faith during the Plan periodto evaluate potential solutions to enable the Company to carry on in some form in the future. Moreover, the Company had expected that a restructuring of current debt would remove RBC’s restrictions and create an environment that would lead to further capital injection supporting the Company’s long-term financial plan. The conclusion of the Plan period is October 11, 2024 as previously announced.
The Company believes that the Creditors will proceed toward receivership enforcement impeding the Company’s ability to continue to operate. If that happens, the Company will likely be forced to lay off its remaining staff and cease operations.
However, as of the end of the day on Friday October 11, 2024 the Company did not receive any definitive information for how the Creditors will proceed.
The Company also provides an update to its news release dated September 25, 2024, announcing its update about its management cease trade order (MCTO) relating to the late filing of the Company’s interim financial statements, MD&A (management’s discussion and analysis), and applicable chief executive officer and chief financial officer certifications for the six months ended June 30, 2024.
The Company’s principal regulator, the British Columbia Securities Commission, granted the MCTO on August 15, 2024, under National Policy 12-203 – Management Cease Trader Orders . Pursuant to the MCTO, the chief executive officer and the chief financial officer of the Company may not trade in securities of the Company until such time as the Company files the interim filings and the commission revokes the MCTO. The MCTO does not affect the ability of shareholders to trade their securities. The Company’s board of directors and management are experiencing the challenges described in this news release; however the uncertainty means the Company continues to work with its accounting team and other stakeholders as it relates to the interim filings. If the Company is not able to file its interim filings for the six months ended June 30, 2024 by October 18, 2024, the British Columbia Securities Commission will issue a broad failure to file cease trade order and no shares of the Company will be permitted to be traded in Canada.
Until the interim filings are filed, the Company intends to comply with the provisions of the alternative information guidelines as set out in NP 12-203 for as long as it remains in default, including the issuance of biweekly default status reports in the form of a news release. The Company has imposed an insider trading blackout pending the filing of the interim filings.
The Company confirms that, since the date of the announcement: (i) there has been no material change to the information set out in the announcement that has not been generally disclosed; (ii) there has not been any other specified default by the Company under NP 12-203; (iii) the Company is not subject to any insolvency proceedings as of the date of this news release, though the Company has entered into the Plan with its secured lenders as disclosed in the Company’s news release dated August 21, 2024 and which Plan expires today though the Creditors have not specifically advised that a receivership order will be sought as described elsewhere in this news release; and (iv) there is no material information concerning the affairs of the Company that has not been generally disclosed.
About Vicinity Motor Corp.
Vicinity Motor Corp. (NASDAQ:VEV)(TSXV:VMC) (“VMC”) is a North American supplier of electric vehicles for both public and commercial enterprise use. The Company leverages a dealer network and close relationships with world-class manufacturing partners to supply its flagship electric, CNG and clean-diesel Vicinity buses, as well as the VMC 1200 electric truck to the transit and industrial markets. For more information, please visit www.vicinitymotorcorp.com .
Company Contact:
John LaGourgue
VP Corporate Development
604-288-8043
IR@vicinitymotor.com
Investor Relations Contact:
Lucas Zimmerman
MZ Group – MZ North America
949-259-4987
VMC@mzgroup.us
www.mzgroup.us
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 securities laws. All statements, other than statements of historical fact, included herein 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. In particular, and without limitation, this news release contains forward-looking statements respecting the Company’s expectations about the Creditors proceeding toward receivership and the inability of the Company to continue to operate. 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 Vicinity’s expectations include the ongoing discussions with the Creditors and impact of a receivership order on the Company if obtained; uncertainties relating to the economic conditions in the markets in which Vicinity operates, vehicle sales volume, anticipated future sales growth, the success of Vicinity’s operational strategies, production prospects at Vicinity’s assembly facility in the State of Washington, the success of Vicinity’s strategic partnerships; and other risk and uncertainties disclosed in Vicinity’s reports and documents filed with applicable securities regulatory authorities from time to time. Vicinity’s forward-looking statements reflect the beliefs, opinions and projections on the date the statements are made. Vicinity assumes no obligation to update the forward-looking statements or beliefs, opinions, projections, or other factors, should they change, except as required by law.
SOURCE: Vicinity Motor Corp.
View the original press release on accesswire.com
FAQ
What is the current status of Vicinity Motor Corp’s (VEV) credit facilities?
Vicinity Motor Corp’s credit facilities with RBC and EDC were not renewed on July 16, 2024, and the company has been unsuccessful in renegotiating terms with the creditors.
When does Vicinity Motor Corp’s (VEV) Workout Plan period end?
The Workout Plan period for Vicinity Motor Corp concludes on October 11, 2024, without a successful financial restructuring.
What are the potential consequences for Vicinity Motor Corp (VEV) if receivership enforcement occurs?
If receivership enforcement occurs, Vicinity Motor Corp may be forced to lay off its remaining staff and cease operations.
What is the deadline for Vicinity Motor Corp (VEV) to file its interim financial statements?
Vicinity Motor Corp must file its interim financial statements for the six months ended June 30, 2024, by October 18, 2024, to avoid a broad failure to file cease trade order.
