At the same time, the company entered into another forbearance agreement with lender Citizens Bank NA, which stipulates that Unique Fabricating must pay $1.23 million in past due interest and attorney and adviser fees.
As part of the accommodation agreement, customers also agreed not to "exercise certain rights of set off, recoupment or deduction" and not to resource parts components to other suppliers.
The deal imposes a deadline of Oct. 31 for the company to be sold to a qualified buyer. The agreement may be terminated by a customer if a default occurs. The company must formulate a restructuring plan, hire a chief restructuring consultant and engage an investment banker within 30 days.
"The accommodation agreement provides for specified price increases to be paid by customers during the term or other funding to be provided by customers to the company through the purchase by customers of a junior tranche of debt to be established under the credit agreement of up to $15 million in the aggregate," the filing said.
The financial struggles of Unique Fabricating, which supplies plastics, rubber and foam, became apparent earlier this year when it failed to report its financials for the fiscal year ended Dec. 31 due its statements being investigated for inaccuracies. Additionally, the company is being investigated for alleged labor rights violations at plants in Mexico.
In its most recent financial report — the one under review — company executives said it took a $6.2 million operating loss and $10.6 million net loss in the third quarter, with projected full-year sales of $136 million. It had just $500,000 in cash and $1.3 million in liquidity under its revolving credit facility.
The company, which also counts Rivian Automotive Inc. and Bosch as customers, aims to continuing operating amid the restructuring process and potential sale.
Unique Fabricating could not be reached for comment Tuesday.
"GM is aware of the developments at Unique Fabricating and is supportive of it as a going concern," GM spokesman David Barnas said in an email. "As such, we are working with several of Unique Fabricating's other customers and its creditors to allow them to be viable long-term through either a restructuring or sale. We do not expect any interruption to GM supply during this process."
Stellantis declined to comment.
Like other automotive suppliers, Unique Fabricating has struggled with production volatility, shrinking volumes and inflation, which have had an outsize impact on smaller companies further down the supply chain.
The accommodation agreement indicates that automakers and Tier 1 suppliers are still willing to make financial concessions to suppliers to keep them afloat, as they did during the supply chain snarls over the past couple of years. When Bingham Farms, Mich.-based Gissing North America LLC filed for Chapter 11 bankruptcy protection last August, GM, Toyota and BMW agreed to fund Gissing's projected liquidity shortfall of more than $14 million as a bridge to it being sold.
Unique Fabricating stock was trading at 23 cents per share as of May 30, having lost nearly all of its value since launching its initial public offering in 2015 at $11 per share.