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Fisker (OTCMKTS:FSRN) shares have transitioned to trading on the over-the-counter (OTC) market following the New York Stock Exchange’s suspension of FSR trading due to an “abnormally low” stock price. The NYSE announced its intent to delist FSR, prompting a shift to the less liquid OTC market, where trade execution may be more challenging, potentially impacting the FSRN stock price.
The delisting mandates Fisker to repurchase its 2026 unsecured 2.50% convertible notes and triggers a default on its 2025 senior secured convertible notes, necessitating immediate note payments to 2025 noteholders.
New York Stock Exchange Initiates Delisting Procedure
Fisker faces a cash crunch, unable to meet obligations to its 2025 and 2026 noteholders.
“We do not currently have sufficient cash reserves or financing sources to satisfy all amounts due under the 2026 Notes or the 2025 Notes, potentially impacting our business, results, and financial condition,” acknowledged Fisker.
A series of unfortunate events culminated in this crisis. Following last Friday’s market closure, Fisker disclosed the abrupt termination of negotiations with a major automaker with whom it was in “advanced talks.” Earlier reports pointed to Nissan (OTCMKTS:NSANY) as the automaker eyeing a $400 million investment in Fisker’s truck platform.
The breakdown scuttled Fisker’s ability to meet a closing condition for a $150 million financing commitment tied to the sale of 2024 senior secured convertible notes. Attempts to amend the agreement terms are in progress.
Given the delisting and financing uncertainties, Fisker’s course of action regarding the upcoming proposals, including share issuances, authorized share increase related to the $150 million financing, and proposed reverse split to address NYSE’s minimum price listing requirement remains uncertain.
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As of the publication date, Eddie Pan held no positions in the securities mentioned in this article. The views expressed reflect the opinions of the writer and align with the InvestorPlace.com Publishing Guidelines.
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