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(a) On October 22, 2025, the Board of Directors ("Board") of Blue Bird Corporation (the "Company" or "Blue Bird"), approved the termination of the previously announced joint venture agreement with Generate Capital, PBC ("Generate Capital"), respecting the joint venture named Clean Bus Solutions, LLC (the "Joint Venture" or "CBS"). Generate Capital, as the other 50% shareholder of the Joint Venture, has also approved termination of the venture, and the Board of CBS will immediately begin the process of winding down affairs and will formally dissolve the legal entity upon completing appropriate legal and contractual obligations.
Description of Joint Venture. On December 7, 2023, Blue Bird announced that the Company, through its wholly owned subsidiary, Blue Bird Body Company, and GC Mobility Investments I, LLC, a wholly owned subsidiary of Generate Capital, a sustainable investment company focusing on clean energy, transportation, water, waste, agriculture, smart cities and industrial decarbonization, had executed a definitive agreement (the "Joint Venture Agreement") establishing CBS to provide a fleet electrification-as-a-service offering using electric school buses. Through the Joint Venture, Blue Bird would provide its end customers with turnkey electrification solutions, including a wide product range of electric school buses, financing of electric vehicles and supporting charging infrastructure, project planning and management, and fleet optimization.
The Company and Generate Capital initially had equal common ownership interests in the Joint Venture, and initially jointly shared management responsibility and control, with each party having certain customary consent and approval rights and control triggers.
The Joint Venture had a perpetual duration subject to the right of either party to terminate early upon mutual consent or upon the occurrence of certain events of default or the failure to achieve certain milestones under the Joint Venture Agreement.
In connection with the execution of the Joint Venture Agreement, the Company granted Generate Capital warrants to purchase an aggregate of 1,000,000 shares of Company common stock at an exercise price of $25.00 per share (the "Warrants"), during a five-year exercise period.
The foregoing description of the Joint Venture Agreement and the Warrants is qualified in its entirety by reference to the full text of the Joint Venture Agreement and the form of Warrant, which were filed as exhibits to the Company's quarterly report on Form 10-Q for the quarter ended December 30, 2023.
Circumstances Surrounding Termination. Through the course of its operation, the Joint Venture was unable to generate business on a timeline that was likely to generate profitable returns for the entity within the expectations of the joint venture partners. In October 2025, the Board of CBS met and voted to recommend to the joint venture partners to terminate the business, wind down operations, and dissolve the legal entity. On October 22, 2025, the Blue Bird Board approved the termination of the Joint Venture and Joint Venture Agreement. Upon obtaining approval from Generate Capital, the CBS Board authorized winding down and dissolution of the business on October 24, 2025.
Through the date of termination, Blue Bird has provided capital infusions to the Joint Venture in the aggregate amount of $1,678,934. No further material financial commitments are anticipated, and the Company does not expect such termination to have a material adverse effect on the Company's future financial condition, results of operations, or cash flows.
Posted In: BLBD
