Written by Cláudio Afonso | LinkedIn | X
Fisker has been facing significant financial challenges with the latest one being a default on its senior secured note due in 2024, a 8K form filed on Tuesday afternoon revealed.
The electric vehicle manufacturer led by Henrik Fisker had entered into a Securities Purchase Agreement on May 10, with CVI Investments, Inc., resulting in the sale of a $3.456 million senior secured note in a private offering.
In the new form, Fisker communicates that was notified by CVI Investments, Inc. on May 29 noting that multiple events of default had occurred including missed repayments, defaults under other notes, incomplete filings, and the expiration of a forbearance agreement.
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Consequently, the noteholder has now exercised its rights to accelerate the note, requiring Fisker to immediately redeem 100 percent of the outstanding 2024 Note at the Event of Default Redemption Price.
Recent Developments
Earlier this week, Fisker announced that its second dealer partner in the United Kingdom has now received inventory.
In a bid to remain visible, Fisker attended the Electrify Expo in California last weekend, providing test drives to attendees. Additionally, the company’s CEO, Henrik Fisker, is set to break months of silence amid the financial turmoil by participating in the Economic Times Auto Tech Summit later this month.
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Workforce Reductions and Store Closures
Fisker has been drastically reducing its workforce in an effort to stave off bankruptcy. A major workforce reduction was announced to U.S. employees on Thursday, which was quickly extended to its Canadian operations, leaving the company with a skeletal crew.
In Belgium, Fisker announced in an email last Friday that its Fisker Center+ in Rumst would close on June 1. Despite this closure, the company remains a tenant of the location and is actively seeking solutions to reopen the facility while negotiating a buyout deal.
Changes in Services and Dealership Strategy
The financial instability has also led to changes in services provided by Fisker. In late May, the company informed its U.S. customers of the discontinuation of its roadside assistance service, mirroring a similar announcement made earlier in the month for its European customers.
In West Covina, California, where Fisker has dealership partners, around 40 units of the fully electric SUV, available in both Extreme and Ultra variants and starting at $34,999, are currently on display. This strategy, which significantly lowers operating expenses, requires customers to search for available inventory in states where Fisker has partnered with dealerships.
Written by Cláudio Afonso | LinkedIn | X
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The post Fisker Faces Default on $3.456 Million Notes Amid Broader Financial Struggles first appeared on EV.