Velo3D has only this weekend to find money for creditors
The Atomic Layers: S5E13 (00129)
Atomic Layer of the Day:
In early autumn, Velo3D made plenty of headlines. And for good reason—dire financial trouble, another round of layoffs, delisting from the NYSE and transitioning to the OTCQX Best Market, and finally, a surprising (and somewhat shady) $8 million licensing agreement with SpaceX (which granted SpaceX a non-exclusive license to Velo3D’s technology and support services).
Then, silence. For over two months, Velo3D disappeared from industry news headlines.
I made it a habit to check their website every couple of weeks, hoping for updates, but there was nothing. Not even the required Q3 2024 earnings report. Is their situation completely unknown?
Until yesterday. On December 12, 2024, Matt Kremenetsky from 3DPrint.com provided an update—one that was anything but trivial. As it turns out, Velo3D is teetering on the edge of collapse—or, to put it differently, hanging onto the edge of the cliff by the tips of their fingertips.
Kremenetsky reports that on December 12, 2024, Velo3D signed a Forbearance Agreement with creditors: High Trail Investments ON LLC and HB SPV I Master Sub LLC. This agreement temporarily protects Velo3D from the consequences of failing to meet obligations related to Senior Secured Notes due in 2026.
A filing with the SEC reveals that since September 2024, the company has failed to make partial bond redemptions and interest payments, has not provided required compliance certificates and reports, and has delayed publishing its Q3 2024 earnings.
The agreement with creditors is valid only until December 16, 2024, giving the company just a few days to take critical actions.
If Velo3D fails to secure additional funds or extend the protection period, creditors may seize the company’s assets, accelerate debt repayment, or initiate bankruptcy proceedings. These scenarios pose a significant risk of total capital loss for shareholders.
What options does Velo3D have? In theory, many—but in practice, nothing. The company could restructure its debt, issue new shares, or find an investor. Alternatively, it could reduce operational costs and focus on more profitable segments.
Essentially, they’d need to accomplish this weekend what they haven’t managed to do in the past two years.
If the worst happens and Velo3D declares bankruptcy, it would mark the first significant bankruptcy of an OEM specializing in industrial-grade AM systems listed on a stock exchange. Until now, major bankruptcies—such as Shapeways, Fast Radius, or SmileDirectClub—have exclusively involved companies offering 3D printing services.
If—and I stress if—Velo3D collapses, it could open the floodgates for further bankruptcies. Mark my words.
Atomic Layer from the Past:
12-13-2017: GE Additive presented the first prototype of its Project H1 metal Binder Jetting 3D printer.
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