Shares of electric automaker, Fisker (NYSE:FSR) skyrocketed by more than 15% in mid-day trading on Monday after the automaker announced that the company had reached an agreement with its 2025 convertible notes investor.
As per the 8-K filing with the SEC, Fisker and the investor have mutually agreed that upon finalizing an agreement with a strategic OEM partner, all liens on intellectual property will be lifted, facilitating the company in actively seeking strategic collaborations.
Furthermore, the revised agreement eliminates any financial covenants related to restricted cash utilized for operations.
“I am pleased that we were able to reach an agreement with one of our investors that will provide increased flexibility and better position us to execute on potential strategic business deals,” Chairman and CEO Henrik Fisker said.
The rally puts the stock on track for its first gain of 2024 after the automaker suffered a 13-day non-win streak. The only day it hadn’t declined this year was Jan. 9th when it closed unchanged.
As of January 19, 2024, Fisker has successfully decreased its outstanding debt associated with the 2025 convertible notes. The debt now stands at $324.5 million, reflecting a substantial reduction of $185.5 million from the initial aggregate issuance amount of $510.0 million. This reduction is attributed to the conversion of a portion of the 2025 notes into equity by the investor.
Shares of FSR are up 12.2% in mid-day trading on Monday.