- Electric vehicle stock Vicinity Motor (TSXV:VMC) has fallen by approximately 50 per cent after receiving letters from Royal Bank of Canada and Export Development Canada demanding full payment of outstanding debt under their respective credit facilities
- The company owes US$19,202,242 to Royal Bank and US$8,625,000 to EDC
- Vicinity Motor is a North American supplier of electric vehicles for public and commercial enterprise use
- Vicinity Motor stock is down by 85.96 per cent year-over-year and 84.35 per cent since 2019
Electric vehicle stock Vicinity Motor (TSXV:VMC) has fallen by approximately 50 per cent after receiving letters from Royal Bank of Canada and Export Development Canada (EDC) demanding full payment of outstanding debt under their respective credit facilities.
Royal Bank expects payment of US$19,202,242 plus C$45,251 by Aug. 19, 2024 – though Vicinity’s books recorded the larger total as US$16,241,641 – while EDC has demanded immediate payment of US$8,625,000 plus interest of US$54,231. Both institutions chose to not renew the facilities, which were set to roll over the debt on July 16.
As interest, costs, fees and expenses under the credit facilities continue to accrue, Vicinity is also facing the harsh reality that its US$77.8 million in assets as of March 31 will be at risk, should it fail to repay it debt. Its lenders have already provided notice of their intention to gain ownership of what they can under the Bankruptcy and Insolvency Act (Canada), leaving the company to engage with them “to carry on in some form in the future,” as Friday’s news release ominously states.
Vicinity has built more than 1,000 transit buses in operation across North America but has recently fallen on hard times because of supply chain issues, lower than expected demand for its VMC 1200 truck, higher than anticipated working capital requirements, as well as “insufficient support from lenders,” the news release cheekily drops in.
With Friday’s loss, investors are down by 85.96 per cent year-over-year and 84.35 per cent since 2019. Shares will continue to trade on the NASDAQ and TSXV, subject to compliance with exchange requirements.
About Vicinity Motor
Vicinity Motor is a North American supplier of electric vehicles for public and commercial enterprise use.
Vicinity Motor stock (TSXV:VMC) is down by 51.19 per cent, trading at C$0.20 per share as of 10:52 am ET.
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(Top photo of Vicinity Motor’s VMC 1200 truck: Vicinity Motor)
