LEV News & Events

Lion Electric announced a reduction of its workforce through temporary layoffs of approximately 150 employees, in both Canada and the United States, across all departments within the organization. Following this workforce reduction, Lion will have approximately 160 employees who will mainly focus on assisting Lion's customers with the maintenance and servicing of school buses and trucks. "The Company was required to implement this workforce reduction in the context of its ongoing proceedings under the Companies' Creditors Arrangement Act as per the terms and conditions of the debtor-in-possession financing provided by the lenders under the Company's senior revolving credit agreement in connection with such proceedings, in order to fund the sale and investment solicitation process being conducted in the context of the proceedings as well as the Company's operations during the restructuring process. As previously announced, the Superior Court of Quebec issued on December 18, 2024 an initial order granting the Company and its subsidiaries protection under the CCAA as well as an order approving a SISP in respect of the Company's business or assets," Lion stated.

Lion Electric announced that the Superior Court of Quebec has issued an initial order granting the company and its subsidiaries protection under the companies' Creditors Arrangement Act, or CCAA. Deloitte Restructuring has been appointed pursuant to the initial CCAA order as monitor of the company. The company and its subsidiaries also intend to seek recognition of the CCAA proceedings in the U.S. under Chapter 15 of the Bankruptcy Code. The Court also issued an order approving a sale and investment solicitation process in respect of the company's business or assets to provide interested parties with the opportunity to submit proposals. In addition, the Initial Order provides for a stay of proceedings in favor of the company and its subsidiaries and the approval of debtor-in-possession financing provided by the lenders under the company's syndicated senior revolving credit agreement to fund the SISP and the company's operations during the restructuring process. 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. Trading in the common shares and other listed securities of the company on the TSX and 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.

The Lion Electric Company announced that the company and its subsidiaries have applied to the Superior Court of Quebec for an initial order to seek protection from their creditors under the companies' Creditors Arrangement Act. The company and its subsidiaries also intend to seek recognition of the CCAA proceedings in the United States under Chapter 15 of the Bankruptcy Code. In its application for an initial order, the company seeks the approval of a formal sale and investment solicitation process in order to provide interested parties with the opportunity to submit proposals with a view to enabling the company and its senior lenders to determine the highest and best available transaction for the company and its stakeholders. The initial order application seeks, 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 authorization of an interim debtor-in-possession financing to be provided by the lenders under the company's senior revolving credit agreement in order to fund the SISP and the company's operations during the restructuring process. Approval is also being sought for the appointment of Deloitte Restructuring Inc. as monitor to oversee the CCAA proceedings and report to the Court. 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. This announcement follows the press release issued by the company on December 17 announcing the expiry of the covenant relief period under the company's senior revolving credit agreement and maturity of the company's loan agreement with Finalta Capital and Caisse de depot et placement du Quebec. Trading in the common shares and other listed securities of the company on the Toronto Stock Exchange and the New York Stock Exchange has been halted. The TSX has also put the company under delisting review under its expedited review process. It is anticipated that trading in the company's listed securities will continue to be halted until completion of the review undertaken by the TSX and the NYSE regarding the suitability of the company for listing on the TSX and the NYSE.

The Lion Electric Company announced the expiry of the previously announced covenant relief period under its senior revolving credit agreement entered into with a syndicate of lenders represented by National Bank of Canada, as administrative agent and collateral agent, and including Bank of Montreal and Federation des Caisses Desjardins du Quebec, as well as the maturity of the company's loan agreement entered into with Finalta Capital Fund, L.P., as lender and administrative agent, and Caisse de depot et placement du Quebec, as lender. The company had previously announced on December 1, 2024 amendments to the Revolving Credit Agreement and the Finalta CDPQ Loan Agreement in order to extend the covenant relief period and the maturity date of the Finalta CDPQ Loan Agreement to December 16, 2024, which provided the Company with additional time to continue to actively evaluate potential alternatives relating to a restructuring of its obligations, a sale of the business or certain of its assets, strategic investments and/or any other alternatives. As no such alternatives have materialized and no further amendments, concessions or waivers have been obtained, the expiry of the covenant relief period and re-introduction of the financial covenants previously applicable under the Revolving Credit Agreement as well as the maturity of the Finalta CDPQ Loan Agreement on December 16, 2024 result in the Company being in default pursuant to the terms of the Revolving Credit Agreement, the Finalta CDPQ Loan Agreement and other debt instruments providing for cross-default or cross acceleration provisions, and in the company's lenders having the ability to exercise their rights and request immediate repayment of amounts borrowed by the company. As a result of the foregoing, the company is currently in discussions with its senior lenders to obtain additional funds pursuant to a new debtor-in-possession credit facility and expects to seek creditor protection under the Companies' Creditors Arrangement Act in order to restructure its business and financial affairs and pursue a formal sales and investment solicitation process in respect of the company's business or assets. Trading in the common shares and other listed securities of the company on the Toronto Stock Exchange and the New York Stock Exchange has been halted and it is anticipated that the trading thereof will continue to be halted until a review is undertaken by the TSX and the NYSE regarding the suitability of the company for listing on the TSX and the NYSE.