Fisker gets new financing, but also said it didn't make an interest payment

MW Fisker gets new financing, but also said it didn't make an interest payment

By Tomi Kilgore

EV maker said it is taking advantage of a 30-day grace period on the interest payment while it seeks partnership with automaker

Shares of Fisker Inc. seesawed to a loss Monday, after the electric-vehicle maker disclosed a new financing commitment, but also admitted it didn't make an interest payment and failed to file its annual report on time.

The disclosures come after the troubled EV maker responded last week to a report that it was exploring bankruptcy, by saying it often engages with outside financial advisers and continued to focus on raising additional capital and seeking a partnership with a large original-equipment manufacturer (OEM), or automaker.

The stock $(FSR)$ plunged 53.6% last week, its worst-ever weekly performance, highlighted by its record one-day plunge of 51.9% on March 14.

In Monday's premarket, the stock jumped as much as 12% soon after the news of the new financing was disclosed, but reversed course to shed 2% in recent trading.

The company said in an 8-K filing with the U.S. Securities and Exchange Commission that it entered into a financing commitment with an undisclosed "investor" for the sale of up to $166.7 million in senior secured convertible 2024 notes.

The notes, which will be sold and issued in four tranches, will be convertible at any time at the investor's discretion to Fisker common stock.

Also in the 8-K, Fisker said it was unable to file its 10-K annual report on time, which puts the company in default under the covenant for convertible notes due 2025 that requires the timely filing of financial reports. But as of Monday, the holder of the notes waived the default.

The company said it was "diligently" working the file the 10-K "as quickly as possible."

The company also said it decided not to make a required cash interest payment of $8.4 million on Friday, which is considered a default.

While Fisker said it had the money - it had a cash balance of $120.9 million as of March 15 - the company decided to take advantage of a 30-day grace period "to allow time for discussions with certain stakeholders in the company's capital structure to continue, while also enhancing liquidity as the company continues to take action to seek a partnership with an OEM partner."

Fisker said the holder of the notes waived the default.

The stock has plummeted 90% year-to-date through Friday, while the Global X Autonomous & Electric Vehicles ETF DRIV has slipped 3.4% and the S&P 500 index SPX has gained 7.3%.

-Tomi Kilgore

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March 18, 2024 08:43 ET (12:43 GMT)

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