Electric scooter manufacturer Vectrix has filed Chapter 11 Bankruptcy. The move has long been expected but a press release from the Rhode Island firm has made it official. The move corresponds with a potential buyout, Vectrix’s PR referring to it as an “asset purchase agreement” with a new company, dubbed “New Vectrix LLC.”
It looks like Vectrix will survive, at least in some form. The Rhode Island company has filed Chapter 11 bankruptcy protection and entered an "asset purchase agreement."
Vectrix now enters Bankruptcy Court, where the company’s assets and liabilities will be up for auction. New Vectrix LLC is “sponsored” by GH Venture Partners LLC
, a venture capitalist firm which owns stakes in a number of companies including Adam Aircraft Industries. New Vectrix LLC does not figure to be outbid during the Bankruptcy process, however, Vectrix is still accepting bids up to an October 27th deadline. Got a couple million sitting around? Contact Vectrix CFO, John D. McGuinness, at 401-848-9993 ext 103, or via email at email@example.com
As for the expected outcome, if New Vectrix LLC wins out the terms of the “asset purchase agreement” require it to put up $5,056,000 for purchase of the company, with a “cash payment of $1,750,000 plus the assumption of up to $3,306,000 in specified liabilities.”
The new company will extend the warranty of existing vehicles sold to dealers and consumers up to a $2,000,000 cap on claims filed “60 days post-petition.” Meanwhile, Vectrix’s Polish subsidiary will continue to manufacturer electric scooters, and “provide customers with accessories, spare parts and technical support.”
Current CEO Mike Boyles says of the bankruptcy move and New Vectrix buyout:
"This transaction provides a platform to continue the Vectrix brand and its advanced electric vehicle technology. We want to express our appreciation to our partners and customers for their continued patience and support during this transition."
Looks like Vectrix will live to fight another day…