Troubled electric vehicle (EV) startup Fisker (NYSE:FSR) has announced the breakdown of negotiations with a major automaker for a potential partnership.
Moreover, the New York Stock Exchange (NYSE) said it would delist Fisker's shares due to their "abnormally low" prices and has also suspended trading in the stock.
Prior to the trading halt, Fisker's stock was trading at $0.09, having closed at $0.13 the previous Friday.
The collapse of the deal with a big car manufacturer has prompted Fisker to explore various strategic options, including potential restructurings both in and out of court, as well as other capital market transactions.
The company's impending delisting will necessitate an offer to buy back its 2.50% convertible notes due in 2026 and will trigger a default event under its senior secured convertible notes due in 2025.
These developments occur in the wake of Fisker halting its electric vehicle production last week, adding to the uncertainty about the company's sustainability.
Further, Fisker said Monday it was unable to meet a key condition for raising up to $150 million through convertible note sales, after failing to make an $8.4 million interest payment due mid-March. Despite claiming sufficient liquidity, Fisker chose to use the 30-day grace period to negotiate its capital structure with investors.
In a separate move, Fisker said it plans to propose a reverse stock split at an upcoming shareholder meeting on April 24, aiming to align with NYSE's listing standards.
FSR has plummeted roughly 95% this year, following the company's February admission of a potential going-concern risk and its decision to halt future project investments pending a strategic partnership.