The Lion Electric Company $4 Million Stockholder Settlement
Former directors, officers, and alleged controllers of Northern Genesis Acquisition Corp. agreed to a proposed $4 million settlement resolving claims that they impaired stockholders’ redemption rights in connection with the SPAC merger that created the publicly traded Lion Electric Company.
Outline:
Northern Genesis Acquisition Corp. agreed to merge with Legacy Lion Electric in 2020. Before the deal closed, NGA stockholders were asked to vote on the transaction and decide whether to redeem their shares. Stockholders later alleged that the defendants breached fiduciary duties and were unjustly enriched by impairing those redemption rights. The defendants deny wrongdoing and agreed to resolve the claims for $4 million.
Timeline:
August 20, 2020: Northern Genesis Acquisition completed its IPO, selling 30 million units at $10 each and placing the proceeds in a trust for public stockholders.
November 29, 2020: NGA entered into a business combination agreement with Legacy Lion Electric to create a publicly traded Lion Electric company.
March 24, 2021: NGA filed its merger proxy, providing information about the proposed transaction and informing stockholders that they could redeem their shares before the merger.
April 21, 2021: The deadline expired for NGA stockholders to decide whether to redeem their shares rather than remain invested through the merger.
April 23, 2021: NGA stockholders voted to approve the merger with Legacy Lion Electric.
May 6, 2021: The merger closed, and Lion Electric common shares and warrants began trading on the New York Stock Exchange and Toronto Stock Exchange.
November 1, 2023: Stockholders filed a class action alleging that NGA’s former directors, officers, and alleged controllers impaired stockholders’ redemption rights in connection with the merger.
August 26, 2026: The parties executed the formal settlement agreement providing for a $4 million cash settlement.
Background:
Northern Genesis Acquisition Corp. was formed as a SPAC in May 2020 and completed an IPO in August 2020. The company sold 30 million units at $10 each, with the proceeds placed in a trust account for the benefit of public stockholders.
In November 2020, NGA agreed to combine with Legacy Lion Electric. As with other SPAC transactions, NGA’s public stockholders had the right to redeem their shares for their portion of the trust instead of remaining invested in the combined company.
Before the stockholder vote, NGA issued a proxy describing the merger and informing investors that the redemption deadline was April 21, 2021. Stockholders approved the transaction two days later, and the merger closed on May 6, 2021, creating the publicly traded Lion Electric Company.
Stockholders later sued several former NGA directors, officers, and alleged controllers. The lawsuit alleges that the defendants breached fiduciary duties and were unjustly enriched through conduct that impaired NGA stockholders’ redemption rights in connection with the merger.
The dispute continued even after Lion Electric entered restructuring proceedings in Canada in December 2024. Plaintiffs successfully opposed an attempt to extend a director-and-officer release in the Canadian restructuring to their Delaware claims, allowing the case against the former NGA defendants to continue.
The defendants deny that they breached any duties, acted improperly, or harmed NGA stockholders. The parties ultimately agreed to resolve the remaining claims for $4 million without any admission of wrongdoing, fault, liability, or damages.
What Can Investors Expect Now?
Former directors, officers, and alleged controllers of Northern Genesis Acquisition Corp. agreed to a proposed $4 million settlement resolving claims that they impaired stockholders’ redemption rights in connection with the SPAC merger that created the publicly traded Lion Electric Company.
If you were damaged due to this situation, you can file for a payout and get your share of the settlement. You can check if you are eligible and other details in the FAQ section.
Frequently Asked Questions
All persons and entities who held shares of Northern Genesis Acquisition Corp. (NGA) Class A Common Stock as of the close of trading on April 21, 2021, either of record or beneficially, and elected not to redeem all such shares in connection with the merger with The Lion Electric Company, including eligible successors-in-interest who acquired shares by operation of law.
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No, if you have purchased securities within the class period, you are eligible to participate.
You can participate in the settlement and retain (or sell) your securities.
The entire process usually takes 4 to 9 months after the claim deadline. But the exact timing depends on the court and settlement administration.
If you're eligible, you can file your claim directly from this case page by clicking the "Collect Payout" button.
More than 100 companies are currently paying out settlements. Connect your brokerage account to automatically check which ones you may have missed — or file manually for this case.
11th.com is an investor recovery company that helps investors track and collect securities class action settlements. We will:
1. Prepare documents for your payout.
2. Audit the claim and make sure you get the maximum possible payout.
3. File a claim with the settlement administration.
4. Correspond with the settlement administration to resolve emerging issues.
5. Deliver payout directly to your brokerage account.
There is no upfront cost, but we will deduct 20% of the recovered amount as a commission for our services.