Burnaby, BC-based hydrogen fuel cell company Loop Energy has alerted its creditors that it filed a Notice of Intention to Make a Proposal (NOI) under Canada’s Bankruptcy and Insolvency Act.
In May, Loop said that it had reduced its headcount to less than 15 people worldwide.
The filing, which does not mean the company has filed for bankruptcy or is in receivership, grants Loop a 30-day stay on claims and proceedings as it crafts a proposal to its creditors with the assistance of its trustee, Vancouver-based accounting firm Crowe MacKay & Company. The NOI, obtained through Crowe MacKay, lists more than $13 million in liabilities, including $9 million to its largest creditor, Pacific Economic Development Canada (PacifiCan), the federal economic development agency for British Columbia (BC).
Subsequently, Sophia Langlois has resigned from the company’s board of directors. Langlois, an ex-KPMG audit partner, was brought on when Loop was listed on the Toronto Stock Exchange (TSX) in February 2021. When Langlois was appointed, Loop president and CEO Ben Nyland said she brought “diverse finance, securities, and audit expertise” and that the company would benefit from her “operational insight and financial prudence.”
The NOI follows Loop closing its production facility in China and laying off approximately 65 percent of its global headcount in 2023, amounting to roughly 84 of the company’s 134 employees. The company cited “challenging capital market conditions, including significant stock price declines in the hydrogen fuel cell sector since the beginning of the year,” as the reason for the layoffs.
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Loop said the decision to file an NOI was made after an “18-month process to find strategic alternatives,” which included considering its cash position and financing options, scheduled payments to suppliers, landlords, and vendors, as well as other operating expenses.
This past February, Loop announced it had entered into an amalgamation agreement with BC-based hydrogen power company H2 Portable Power, but later announced the deal had been terminated. In May, Loop said that it had reduced its headcount to less than 15 people worldwide and that it might have to wind down operations if it could not raise additional capital or sell its assets.
Founded in 2000, Loop designs and manufactures hydrogen fuel cell systems primarily used for the electrification of commercial vehicles and stationary power systems. Nyland became president of Loop in 2015 and CEO in 2016, overseeing the growth of the company’s operations internationally and launching multiple products before raising $100 million from an initial public offering (IPO) on the TSX.
Feature image courtesy Loop Energy.