Vicinity Motor Corp board resigns after receivershi

VANCOUVER, BC – The entire board of directors at Vicinity Motor Corp. (NASDAQ:VEV)(TSXV:VMC), a bus manufacturer, has stepped down following a recent court decision. The Superior Court of British Columbia granted a petition for Receivership of the company to the Royal Bank of Canada on October 21, 2024. Subsequently, all board members, including Joseph Miller, Andrew Imanse, William Trainer, Chris Strong, James White, and John LaGourgue, resigned. Tina Stewart, the Chief Financial Officer, also left her position.

This move comes as the company faces a ‘Change of Control’ after not being contacted by the Receiver(s) post-receivership grant. The implications of these resignations on Vicinity’s operations and governance structure are yet to be fully understood. Receivership often occurs when a company is insolvent and unable to meet its financial obligations. In such cases, a receiver is appointed to manage the company’s assets and operations.

The news of the board’s resignation follows a period of uncertainty for Vicinity Motor Corp., which has been navigating financial challenges. The company has not provided any forward-looking statements about the potential impact of the receivership on its operations or future prospects.

Investors and stakeholders are closely monitoring the situation as the company’s discussions with creditors continue. The receivership order’s effect on Vicinity’s ability to operate remains a key concern.

This development is a significant shift in the company’s leadership and could signal changes in its strategic direction. The information in this article is based on a press release statement from Vicinity Motor Corp.

In other recent news, Vicinity Motor Corp is facing significant financial challenges. The company has been notified of its impending delisting from the Nasdaq due to non-compliance with the minimum bid price requirement. Concurrently, Vicinity Motor Corp has entered receivership, as ordered by the Supreme Court of British Columbia, and is under a management cease trade order due to delayed interim financial filings.

Despite these difficulties, Vicinity Motor Corp reported a 400% surge in Q1 2024 revenues, attributed to the deliveries of its electric trucks and clean diesel buses. The company’s VMC 1200 electric truck has received certification as a zero-emission vehicle from the California Air Resources Board, allowing sales across all U.S. states. Additionally, customers purchasing Vicinity Motor Corp’s electric vehicles are now eligible for significant tax credits, following the company’s approval as a “qualified manufacturer” by the U.S. Internal Revenue Service.

These recent developments highlight the company’s ongoing efforts to navigate its financial challenges while continuing to make strides in the commercial electric vehicle sector. Investors are advised to monitor the situation closely as events unfold.

InvestingPro Insights

The recent developments at Vicinity Motor Corp. (NASDAQ:VEV) are reflected in the company’s financial metrics and market performance. According to InvestingPro data, VEV’s market capitalization has dwindled to a mere $2.54 million, underscoring the severity of its financial situation. The company’s stock price has plummeted, now trading at just $0.06, which represents only 6.3% of its 52-week high.

InvestingPro Tips highlight several critical issues facing the company. VEV is operating with a significant debt burden and may have trouble making interest payments, which aligns with the recent court decision granting receivership. The company’s financial health is further strained as it is quickly burning through cash, and short-term obligations exceed liquid assets.

Despite these challenges, VEV has shown a significant revenue growth of 399.58% in the most recent quarter. However, this growth hasn’t translated into profitability, as the company reported a negative operating income of $8.05 million over the last twelve months. The gross profit margin stands at a weak 11.97%, indicating challenges in operational efficiency.

The stock’s performance has been dismal, with a one-year price total return of -93.1%. This aligns with the InvestingPro Tip suggesting that the stock has fared poorly over various time frames, including the last month, three months, and year.

Investors seeking a more comprehensive analysis can access 19 additional InvestingPro Tips for VEV, providing deeper insights into the company’s financial situation and market position.

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